Articles in Category: FHA One-Time Close

One Time Close Mortgage Loans: The Base Home Sales Price

February 12, 2021

One-Time Close Mortgages Compared To Other Home Loans

How do One-Time Close Loans differ from other mortgage types? There are FHA One-Time Close loans, VA construction loans, and USDA versions. How do the construction loans differ from buying someone else’s home? The first way they differ is time–it takes more time to get the key and move in when you build a home from the ground up than it does to buy existing property. But the time you spend building is worth the investment–you get to approve the design of the home you are moving into, and that’s a big deal for some house hunters. Build Or Buy? Deciding isn’t hard for some people–they want the ability to customize. There are FHA loan options for doing so that don’t require you to commit to building from scratch–some choose | more...

Home Loans For Building On Your Own Land

February 3, 2021

One-Time Construction Loan Amortization: What You Need To Know Before You Sign

By Bruce Reichstein

The FHA One-Time Close construction loan allows you to have a house built to your specifications rather than buying an existing home. This loan, which also has a VA mortgage counterpart as well as a USDA version, gives borrowers the ability to choose a specific design instead of settling for one you aren’t as interested in. An One-Time Close loan, which is offered to first-time home buyers and experienced home owners alike, provides the means for you to build on your own lot. You can also choose to purchase land with the loan funds as well as building the home. One Time Close loans can take longer depending on how fast the construction phase of the loan goes, but the ability to approve the design and features of the home | more...

January 28, 2021

Low FHA Mortgage Rates In 2021

By Joe Wallace

January of 2021 brought some anticipation about what might happen with home loan interest rates. Would conditions become less volatile and more stable? Would rates start to rise along with investor certainty in the markets that influence mortgage rates? Does fear and uncertainty persist in the new year? Some professional market watchers wrote (in the early days of January 2021) that mortgage rates got started this year minus volatility (at least early)…FHA loan rates on 30-year fixed-rate mortgages are reported in January 2021 below the three percent range–so far, fairly “typical” of what people have come to expect during the pandemic. At the time of this writing, you’ll find FHA mortgage loan interest rates are reported at 2.25% for “best execution” loans which have ideal conditions including a well-qualified borrower. | more...

FHA Construction Loan Rule Changes In 2021

January 15, 2021

FHA And HUD Update Construction Loan Rules

By Bruce Reichstein

If you are in the market for a home but would prefer to have a house built to your specifications instead of buying another person’s dream home, the One-Time Close mortgage can help you build instead of buy. This type of loan has an FHA equivalent with low down payment requirements (3.5% in typical cases) and there’s also a VA home loan option for those with qualifying military service. The FHA and HUD recently updated its rulebook for FHA Construction loans; there are revised definitions of properties that qualify for construction loans as well as new inspection rules. Back in 2020, the FHA and HUD announced some pending changes to the FHA Single-Family Home Loan Lender’s Handbook, HUD 4000.1 due to policy alterations in 2018 and 2019. Those alterations required | more...

Don't Make These Mistakes With Your One-Time Close Construction Loan

January 8, 2021

Monitoring Your Credit Ahead Of Your Rehab Loan Or One-Time Close Loan

By Bruce Reichstein

Credit monitoring is important for any consumer but borrowers interested in building a home on their own lot using a One-Time Close (OTC) construction loan or even an FHA 203(k) Rehab loan should give serious thought about investing in credit monitoring as early as possible in the planning stages. This can be a big advantage for those seeking rehab or construction loans; participating FHA lenders may require higher FICO scores for construction loans and you’ll want every advantage in that department including knowing the contents of your credit report and the changes to it as they happen. FHA Rehab Loans allow borrowers to buy fixer-upper loans and have work done to bring them up to code and FHA standards; FHA One-Time Close (OTC) mortgage loans allow borrowers to build a | more...

January 6, 2021

One-Time Close Construction Loan Availability In 2021

By Joe Wallace

Here is a commonly asked question about One-Time Close construction loans; “I want to build my home instead of buying it but my lender says they won’t do a construction loan”. Or conversely, “I want to use a VA mortgage to build a home but the lender says they don’t offer VA construction loans. Can they do that?” If you are interested in building a home from the ground up instead of buying an existing property, you can use the One-Time Close construction mortgage to do so and there are a variety of options including both VA loans and FHA construction loans. People gravitate toward these mortgages because of more forgiving FICO score rules and lower down payment requirements. But not all lenders offer FHA mortgages or VA home loans; | more...

December 31, 2020

Happy New Year 2021!

By Joe Wallace

We hope your holiday season has been safe and fun. We pause from our usual posts about FHA home loans to enjoy New Year’s Eve and New Year’s Day 2021, and our regular posting schedule resumes on Monday. Thanks for reading and have a great holiday.

December 30, 2020

Five Facts You Need To Know About FHA Loans In 2021

By Bruce Reichstein

Are you interested in buying or building a home in the new year? Be informed about several issues that may apply to you when building or buying a new home. With a little information you can become better prepared to explore your FHA home loan options in 2021 5. FHA Loan Limits Are Higher in 2021 FHA loan limits go up again for the majority of housing markets in the USA again in 2021; higher loan limits may make the difference for some trying to decide where to purchase or build as well as for what kind of property to buy. Don’t forget that FHA loan limits are higher for multi-unit properties. Those interested in building a home using an FHA One-Time Close construction mortgage should ask their lenders how | more...

December 28, 2020

FHA Home Loan Options: Build Or Buy A Home In 2021

By Joe Wallace

Do you want to own your own home in 2021? The FHA Single-Family home loan program is an excellent option for future homeowners who want to build or buy a home in the new year. What are your options for buying a house with an FHA mortgage? Those who have good credit (620 or better) and are not in a hurry to move in as soon as possible should consider applying for an FHA One-Time Close (OTC) construction loan to build a home from the ground up on your own land or on a lot you buy in conjunction with the construction loan. Another option for those who aren’t in a hurry to move in is the FHA 203(k) Rehabilitation mortgage, which is intended to help you buy a fixer-upper | more...

Who should apply for a construction loan?

December 21, 2020

Build Your Dream Home With A One-Time Close Loan

By Bruce Reichstein

Do you own land you want to build a home on with a low down payment? Do you want to build a house from the ground up and purchase the land at the same time? There is a construction loan that can allow you to do both–the One-Time Close construction mortgage. These loans, also known as OTC mortgages or single-close mortgages, are offered as FHA mortgages (with a low 3.5% down payment requirement for any financially qualified borrower), USDA loans (need-based mortgages with income caps and other requirements) and VA construction loans with no down payment required in most cases. Some potential homeowners may be hesitant to commit to a construction loan–the process is unfamiliar to them, and to some it just seems a bit overwhelming. But getting started is | more...