Construction & Renovation Loan
FHA One-Time Close
Build your next home with FHA financing. One loan covers the lot, the construction and your permanent mortgage, with a single closing.
- CoversLot, construction and permanent loan
- ClosingsOne
- Down paymentAs little as 3.5% with qualifying credit
- Home typesSite-built, modular or manufactured
How It Works
Build once, close once.
A one-time close loan rolls construction financing and your long-term FHA mortgage into one. You qualify and close up front, the builder is paid in stages as the home goes up, and the loan becomes a standard FHA mortgage when the home is finished.
- 01
The lender reviews you and your builder
The lender approves you under FHA standards before construction starts, and also reviews your builder, who must be licensed and approved by the lender.
- 02
Plans, budget and appraisal
The appraiser values the home from the plans and specifications, and the loan is sized from the land and the full construction budget.
- 03
We find a lender that builds
Few lenders offer FHA construction loans, and their requirements differ. We match your project with one that does and follow the draws through to move-in.
Program Highlights
Why buyers build with FHA.
- One closing for the land, the construction and the permanent mortgage
- FHA's flexible qualification and low down payment, with qualifying credit
- Works for site-built, modular and manufactured homes
- Equity in land you already own may count toward your down payment
- The builder is paid in stages as work is inspected and completed
- Becomes a standard FHA mortgage once the home is finished
Common Questions
What buyers ask about FHA construction loans.
It is an FHA-insured loan that pays for building a new home and then becomes your permanent mortgage. With a one-time close, you qualify and close once, before construction starts, instead of taking a construction loan and refinancing later.
You need to meet FHA credit and income standards, the home must be your primary residence, and the builder must be licensed and approved by the lender. The plans, budget and appraisal are reviewed before closing. Lenders often set their own credit minimums for construction, which can be higher than for a standard FHA purchase.
Fewer lenders offer FHA construction loans than standard FHA loans, and the ones that do set different builder and credit requirements. As a broker, we know which of our wholesale lenders offer it and which one fits your project.
Yes. If you own the lot, its equity may count toward your down payment, depending on how long you have owned it and the lender's rules. If you are buying the lot, it can be included in the loan.
It depends on the lender. Some programs set aside funds to cover interest during construction, and others ask for interest-only payments on what has been drawn. We will walk you through how your lender handles it before you commit.
Yes, as long as the home meets FHA and HUD standards and is placed on a permanent foundation on land you own or are buying. Site-built homes qualify too.
General information only, not a commitment to lend. Loan programs, guidelines, interest rates and terms are subject to change without advance notice.
Plan your build across our lender network.
Tell us about the lot, the builder and the home you want. We will show you what an FHA construction loan would look like and which lenders fit.