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Deciding to build your own home can offer many benefits. From building the house you’ve always dreamed of to giving you the flexibility to build in an area of your choice, it’s a great choice for homeowners who want options.

One big decision you’ll need to make when deciding to build your own home is how to finance your new construction home.

Single Close Construction loans are also referred to as:

  • single close loans
  • construction to perm loans
  • one-time close loans
  • construction conversion loans
  • CTP loans
  • Or even “all in one loans” "

Here’s what you need to know about them.

What is a Construction Loan?

Construction loans are typically a short term loan to finance the building of a home and then transition to a long term mortgage loan. Traditional new home or stand alone construction consists of two loans:

Loan 1: The homebuyer is expected to open a loan to pay for construction of the home

Loan 2: A second loan is required for long-term financing.

These processes are completely separate and might even involve two different lenders and two different interest rates.

What is a Single Close Construction Loan?

A Single Close Construction to Permanent loan is a home mortgage that can be used to close both the construction loan and permanent financing of a new home at one time.

With a Single Close Construction loan, the process is streamlined: A single mortgage loan originator, a single loan, and a single closing process. This saves money, helps reduce the time to move into your house, and protects you against unforeseen circumstances down the road.

Single Close Loans vs. Multiple Loans

The traditional construction loan process produces a lot of worry for borrowers. Because there are at least two different loans – one before construction begins and one after it ends – there is always the possibility that circumstances change and the second loan won’t close as expected.

Sometimes, new construction even requires a third “take-out” loan to prove you can pay for the construction project. That means more fees, more paperwork, and further risk of complications.

Over the years, this arcane process has left thousands of people struggling to put together new financing or negotiating a loan workout at a time when they should be enjoying the home they’ve always wanted. The one-time close construction loan concept is designed to avoid all that.


What are the Benefits of a Single Close Construction Loan?

1. You Only Need to Qualify Once

Time and again, homebuyers point to loan qualification as the most stressful part of getting a new home – so why do it twice? With a Single Close Construction Loan, you qualify at the beginning of construction.

Single Close Construction loans ensure that the loan terms you agreed to cannot expire and the loan documents you receive will always be up to date. That means peace of mind when making big decisions.

2. Single Close Reduces Risk for Borrowers

Having to qualify up to three times in home construction is a major risk to the buyer. If you have a bad investment, a change of career, or other temporary cash flow problems, you could end up losing your home and all you’ve invested in it – even if your overall financial picture is sound.

With one-time close construction loans, there is no risk. Once you have qualified at the start of the process, you are in it for the long haul – just like your new home. You will never be at risk of foreclosure due to transient changes in your financial situation.

3. You Benefit from Fixed Interest Rates

Many 30-year home loans have variable interest rates that can catch you by surprise as they “balloon” over time. Our one-time close construction loan products offer predictable fixed rates.

Fixed rates persist throughout the construction loan and the permanent construction loan, so there are no surprises. Many of our clients qualify for favorable rates that make their lives easier.

4. You Only Pay for One Closing Day

Multiple loans mean multiple closings, each of which can cost thousands. The standard cost of closing is 3%-5%. GO Mortgage streamlines closing to one-time, which can save you lots of money. You may be able to finance less or save more for the purchases you want for your new home.

5. You Get Single Appraisal Valuation

For both new and existing homes, appraisal valuation is a serious stumbling block. If the appraised value of the home is lower than expected, it can endanger your financing package. Not so with Single Close Construction loans: One appraisal prior to loan closing and you’re all set.

6. You Can Choose Your Build

Most mortgage programs are only for conventional construction. With mortgage lenders like GO Mortgage, you have the option of a modular, manufactured, or stick-built home. You can build your dream home on your land no matter what form it takes – and we can help you get there all at one-time.

All these benefits and more are available to our clients. After helping homebuyers from around the country, the factor that comes up, again and again, is an even simpler one: “Peace of mind.”

How Does the Single Close Construction Loan Process Work?

one-time close construction loan process #1

1. Builder Eligibility & Review

 You should find a reputable builder in your area to work with. 

At GO Mortgage, a few of our builder eligibility requirements are:
-3 years minimum experience building residential homes.
-Minimum of $1million per year in volume.
-Building residential homes is their primary business.


one-time close construction loan process #2

2. Contract Preparation

Once you’ve worked out parameters with your builder, a contract will be prepared. The contract covers everything you need to know about the construction process, such as timeline and what will be done about cost overruns. It also establishes your responsibilities to the builder.

GO Mortgage works with you to determine if the home you selected is within your budget, and with your builder to determine the cost to build your home and finance it

one-time close construction loan process #3

3. Contract Signed

Once a purchase price is determined and you’ve examined your contract in detail, you sign it. The finalized contract is forwarded to our construction underwriting team, who will also evaluate it. Signing the contract and getting the relevant documentation to all parties usually takes only a few days.

At GO Mortgage, a signed contract begins the loan approval process.

one-time close construction loan process #4

4. Project Review And Underwrite The Loan

Your loan will be submitted for a construction project review and to our underwriting department to approve the permanent portion of the loan. In underwriting, a financial institution takes on financial risk as part of a larger transaction.

GO Mortgage underwrites the construction process. This means in the event the borrower can’t meet obligations or the builder does not perform as expected, we can take action.

The credit package for the long-term financing of the home must also be underwritten. With our underwriting services, you save time and money compared to conventional loan origination. For example, you do not need a 20% down payment or pricey mortgage insurance.

one-time close construction loan process #5

5. Loan Closes

The closing of the loan package includes a final review of all the financial information submitted by the borrower, especially documentation of current income and financial liabilities. Because of the way our process is structured, loan closing is merely a formality for most borrowers.

Once the paperwork is signed and your loan has closed, the construction of your new home can begin!


one-time close construction loan process #6

6. Construction Begins

Construction needs to begin within 30 days of the closing date. Your construction team will provide you with regular updates on the progress of your home. In general, it takes about one year for most homes to go from breaking ground to move in day.

GO Mortgage will manage the construction phase from ordering draw inspections, and any state required surveys and inspections.

Securing a One-Time Close Construction Loan

Getting a loan package for new home construction is notoriously difficult. Buyers must find a way to finance the land, the construction project, and the home. In many cases, they are required to get a “take-out” loan that verifies to the builder that they can afford the entire project.

The complex nature of new home construction means there are plenty of moving parts. Each time a buyer needs a new financing package, they have to re-qualify. They may also need to get the property appraised multiple times throughout the process.

Qualifying for a One-Time Close Construction Loan

Loan qualification is the biggest hurdle for most home buyers – but it’s not as intimidating as it looks. Qualifying for a one-time close construction loan is no more complicated than qualifying for a conventional home loan. If you’ve ever bought a property, you’re familiar with the steps.

Naturally, not everyone will qualify for a one-time close construction loan. Your loan amount will depend on your overall financial health and risk level.

“With the builder (and property), the lender GO Mortgage and us all in different states, I can assure you I was more concerned as to how smoothly this transaction would go. To add more layers of complexity, our builder was new to GO Mortgage, and this was a Single Close Construction to permanent mortgage on a modular vacation home. Even with all of those circumstances, the GO Mortgage team worked to keep things running smoothly and got it closed all at one-time! I wouldn't hesitate to recommend them to anyone.”

- Michelle from Gulf Shores, Alabama

Available Single Close Construction Loan Programs

When you choose one of these government-backed home loan products, it means that your lender must follow specific rules in what fees can be charged, what interest rates are allowed, and how the funds can be used. This helps protect buyers from unfavorable loan practices.

Remember, these loans are issued by an approved lender, not directly by the government.

Many federally-backed loan programs enable buyers to move forward on their home purchase with low or no down payment. Buyers who have poor credit  are also protected as long as their current financial situation allows them to meet their mortgage obligations.

Naturally, all of our available loan programs can be used to finance new home construction. We also work with buyers to help them finance land when they do not already have a lot to build on.

Some of our most popular loans include:

a. Federal Housing Administration (FHA) Construction Loans

FHA Single Close Construction loans are designed for low- and moderate-income buyers and are especially popular for those seeking a starter home. They require lower down payments and lower credit scores than a conventional loan package.

b. Veterans Administration (VA) One-Time Close Construction Loans

Available only to qualified veterans and their eligible surviving spouses, a VA Single Close loan equips you to build, buy, repair, retain, or adapt a home. No down payment is required, closing costs are limited, and you cannot be charged a penalty for paying the loan in advance.

c. U.S. Department of Agriculture (USDA) Construction/Single-Close Loans

A USDA Single Close loan, also known as a rural development loan, is available in certain rural and suburban areas. These 30-year fixed rate mortgage loans do not require a down payment. Buyers can even finance their closing costs, minimizing additional expenses beyond the home’s upfront cost.

d. Fannie Mae Construction Loan Programs

Fannie Mae is a government-sponsored company that guarantees loans, allowing lenders to extend loans to lower-income home buyers with reduced risk. The Fannie Mae Single Close Construction loan program mandates a minimum credit score of 680 for fixed-rate loans applied to single-family homes.

Single Close Construction Loan Rates

Loan rates for single close construction loans can vary based on a variety of factors including:

  • your credit score
  • location
  • loan type
  • loan amount

If you’re ready to find out what your construction loan rates could be, get in touch with a GO Mortgage construction loan advisor!


Finding a Single or One-Time Close Construction Lender

When considering a single close or one-time close construction loan, it’s important to find the right lender to work with. Experience and a proven process are important to create the best overall experience possible. At GO Mortgage, our in-house construction experts are able to answer questions that cover everything from the construction process to the post-construction process. We have loan officers across the country ready to help you with your dream of building a home.

See the map below to find out if we have loan officers in your state.

Working with GO Mortgage for Your Single Close Construction Loan

GO Mortgage has not only simplified things, but has an in-house one-time close construction management team.

Using our years of experience and home-building expertise, our in-house construction experts review and approve documentation from every stage of construction.


  • Project budget and timeline
  • Planning and specifications
  • Permits and inspection
  • Building code best practices

In many cases, buyers find they are “on their own” when dealing with builders. They have little negotiating power and few resources if their builder does not meet all project requirements.

As a GO Mortgage client, our team will help keep your project on track every step of the way. This allows potential problems to be dealt with before they can turn into major delays.

You will want to find and engage the builder of your choice as long as they meet the quality standards for our program. 

Our builder vetting process gets to the heart of what matters for you. We make sure that all builders accepted into our program have a sterling record of on-time completion for their home projects. Quality, safety, and efficiency are our top priorities.

Our completely hands-free building process means you never need to worry about applying for building permits or arranging inspections as your construction takes shape. It is all handled for you. Documentation you might need in the future is centralized all in one place.

The GO Mortgage One-Time Close Construction Loan Advantage

GO Mortgage has developed a unique one-time close construction loan process by bringing all of the needed expertise “in house.” GO Mortgage is also a direct seller and servicer to Fannie Mae and a Freddie Mac Direct Lender, and a Ginnie Mae issuer. This means we have access to nearly every mortgage product. FHA, VA, and USDA loans are just a few of the available options.

You can get your one-time close construction loan as a conventional loan as well as any number of popular government-backed loan programs including FHA, VA, and USDA.

The Loan Lifecycle

With the one-time close construction loan, you receive both the interim construction loan and the 30-year permanent loan at the same time. That means a single promissory note and one deed of trust. You sign the 30-year amortizing promissory note at closing.

Once the promissory note is signed, any liens on the land will be automatically paid off. A draw amount will be made available to the builder so construction can start right away. When the project is complete, you’ll receive a loan modification to amend the date for first payment.

After the loan modification is signed, the 30-year amortizing loan works like any other home loan. Fixed interest rates mean there’ll never be any surprises throughout the process of paying off your loan. All along, you will get to enjoy your dream home exactly as you imagined it.

Remember: Most of this process will be handled for you behind the scenes by the friendly team at GO Mortgage and your builder. All you need to do is be ready to discuss your needs with your builder and read contracts closely at each stage of the process. We will always be there to help!

FAQs About Single Close Construction Loans

1. Do You Need a Down Payment for a Single Close Construction Loan?

Whether you need a down payment for your loan depends on the specific loan program you decide to use. In a traditional construction loan, most buyers need a down payment around 20% to access the most favorable one-time close loan terms.

Our one-time close programs offer down payments anywhere from 0% to 3.5%, to a maximum of 5%, a small fraction of what other lenders typically ask for. 

2. Do You Need a Minimum Credit Score for a Single Close Construction Loan?

Credit is just one factor used to decide how much you can finance with your one-time close construction loan. A credit score of 700 or above is considered low risk, while a score of 800 to 850 is exceptional – but even very affluent people do not always have a score this high.

Our one-time close construction program requires a minimum credit score of 640. We will examine your entire financial outlook and work with you to find a loan solution that meets your needs. Current income and investments are weighted heavily.

3. Do I Pay Anything During the Process?

On most of our construction products, your first payment does not take place until after construction is complete.

4. How Much Are Closing Costs?

Closing costs may vary depending on your situation and your total loan amount.

5. How Long Does It Take to Build a House?

Ideally, new home construction is completed within about 12 months. Every step is taken by our in-house construction management team to complete the process in a timely manner. However, ultimate performance is up to the builder and unforeseen circumstances can happen. The type of home, its size, and the builder’s schedule all influence project length.

6. Can I Do Any Construction Work Myself?

No. Your builder must complete all the work.

7. Can I Use a Loan for an Investment Property?

No. Investment properties and “spec” homes are not eligible.

8. Can I Still Get a Loan If I Don’t Own Land?

Yes. Your land purchase can be rolled into your one-time transaction – and covered in your single closing.

9. Can My Land Be a Gift?

Yes. You must own the land for at least six months (in most cases) to use its appraised value.

10. Can I Tear Down an Existing Home and Replace It With a New One?

Teardowns and rebuilds are available for some loan types, but not others. To get accurate information for your specific loan type, talk to your loan officer about your needs.