The Built Mortgage Team, Powered by Motion Mortgage Inc.
Conventional One-Time Close Construction Loans
A Conventional one-time close construction loan combines construction financing and the permanent mortgage in one closing. Eligible borrowers may qualify with 5% minimum down and a 620 minimum credit score through our lender, subject to full underwriting; down payment requirements vary by occupancy. Lender completion conditions apply before the permanent phase.
Minimum down; varies by occupancy
Minimum credit score; full underwriting applies
Closing; completion conditions apply
What are the Conventional one-time close requirements?
- Credit: 620 minimum.
- Down payment: 5% minimum.
- Loan amount: County conforming limits.
- Mortgage insurance: Program-dependent.
- Occupancy: Primary, second home, investment.
The 5% minimum down payment is for eligible borrowers; requirements vary by occupancy type. Primary residences, second homes and investment properties are subject to program requirements. The 620 minimum credit score is subject to full underwriting.
Loan amounts are limited to county conforming limits; no jumbo financing is offered through this program. Check FHFA’s conforming loan limit values. Mortgage insurance may apply with lower down payments.
The builder must be reviewed and approved by the lender; do not assume an owner-builder can participate. Financing is subject to borrower, builder, property and lender review.
Which home types can I build?
- Site-built (stick-built)
- Modular
- Manufactured
- Eligible barndominiums
Every home is subject to appraisal and lender review.
Can I combine land purchase and construction?
Eligible land purchase may be combined with construction financing. If you already own land, discuss how the lender treats it as part of your proposed project. Land, borrower, builder and property review still apply.
How does Conventional construction-to-permanent financing work?
1
How do I begin pre-approval?
Discuss borrower qualifications and the proposed project with the lender. Minimum credit and down payment figures remain subject to full underwriting.
2
How are land, builder and plans reviewed?
Eligible land purchase may be combined with construction. Already-owned land can be discussed with the lender, and the builder must be reviewed and approved; do not assume an owner-builder can participate.
3
What happens during appraisal and underwriting?
The lender reviews the borrower, plans, budget, proposed home and completed-home appraisal against the selected program’s requirements.
4
What does the single closing cover?
One closing covers construction financing and the permanent mortgage. Review the loan agreement and lender completion conditions before closing.
5
How are construction funds released?
The lender controls construction draws with inspections rather than releasing the full construction budget at once.
6
When does permanent financing begin?
Lender completion conditions must be satisfied before the permanent mortgage phase begins.
How do VA, FHA and Conventional one-time close loans compare?
| Consideration | VA | FHA | Conventional |
|---|---|---|---|
| Eligibility | Eligible VA borrowers; COE required, not loan approval | Eligible borrowers; full underwriting applies | Eligible borrowers; full underwriting applies |
| Minimum down payment | Potential $0 for eligible veterans; entitlement, appraisal and lender review apply | 3.5% for eligible borrowers | 5% for eligible borrowers; varies by occupancy |
| Minimum credit score | 600 through our lender; full underwriting | 580 through our lender; full underwriting | 620 through our lender; full underwriting |
| Loan amount | Up to $4,000,000 through our lender; entitlement, appraisal and lender review | County FHA limits | County conforming limits; no jumbo |
| Mortgage insurance | No monthly mortgage insurance; funding fee may apply and may be financed; exempt borrowers pay no fee | Upfront FHA MIP plus annual premium paid monthly | Program-dependent; may apply with lower down payments |
| Occupancy | Primary residence | Primary residence | Primary residence, second home or investment property; program requirements apply |
| Who it fits | Eligible VA borrowers building a primary residence | Eligible borrowers seeking low-down-payment financing | Eligible borrowers considering primary, second-home or investment construction |
Use our construction loan comparison hub to discuss the program that fits your project.
Where is this construction program available?
Available in these five service areas, subject to borrower, builder, property and lender review:
What else should I know about Conventional construction loans?
Ready to discuss your construction project?
Tell The Built Mortgage Team about your land, home and builder. Financing remains subject to borrower, builder, property and lender review.