How to Use a One-Time Close Construction Loan to Finance Your Home

If you are building a house, a one-time close construction loan finance option is the best way to pay for both the construction and the house itself.  Using it, you only have to negotiate the terms with your mortgage lender once for everything.

Ins and Outs of One-Time Close

Without the one-time close construction loan, you need 2 different loans: one for construction and one for the house. With one, you save money because the interest rates will be locked in, and you are done for both phases.

A one-time construction loan specifies how long it will take to build your home because there are set timeframes to pay out the funding for your builder. You can also let the builder take money as needed. During this, monthly mortgage payments are made on that part of the loan. Once the building phase is done, it converts into a regular mortgage loan for the rest of what is due.

Applying Is Simple

Applying for this type of loan is the same as is using a normal mortgage application. You submit credit scores, proof of income, etc., and are approved based on the lender’s guidelines. Keep all paperwork and receipts from the construction phase, like your contractor’s budget, house blueprints and any other information as requested by the lender for documentation.

The one-time close construction loan finance option is the best way to finance a home being built because it saves time and money, and it produces one monthly mortgage payment.