Wondering what the difference between a one-time close and two-close loans is? Let’s start with two-close loans. When you want to buy a property and build on it, you need to get approved twice -for two different loans. Once you get approved for the first loan, you can start constructing your dream home. And then, you need to apply for another long-term loan, this time to refinance your construction loan payable in 15 or 30 years.
The downside of having two-close construction loans is that you need to prepare for everything twice – you submit your papers twice, you prepare for your requirements twice as well. Everything is done in doubles.
One-time close is different. From buying your land to building your home until it becomes a traditional mortgage (which is long-term and usually a 30-year mortgage), everything is done in one go. One-time close is also called construction-to-permanent loans.
One-time close construction loans in Texas, and other areas, can be used not only for conventional loans but other federal-backed loans like VA and FHA loans. Federally backed loans, like FHA, can go as low as 3.5% downpayment, while VA loans offer zero down and no mortgage insurance as well.
We can help you start your way towards building and owning a house. One-time close deals help you save money and time as well. So if you want to start the process, let us know to find the best deal for you.
Some of the things you need to prepare for your application are as follows:
- Building permit
- Certificate of Occupancy
- Final inspection by an FHA Roster Inspector
FHA loans can be closed within 30 days after applying, especially if all of your papers and requirements are in order. If you can cover the downpayment, the taxes, and closing costs, then you can be sure that you are well on your way to getting your dream home. Call us, and we’d be glad to help you close the deal.