A VA one-time close construction loan is a type of financing that streamlines the process of building a new home or property by combining the construction loan and the permanent mortgage into a single transaction. Unlike traditional construction loans that require two separate closings—one for the construction phase and another for the permanent mortgage—a one-time close construction loan simplifies the process by offering a single closing. The best of the VA One Time Close is that you pay NO INTEREST ONLY PAYMENTS during construction. 

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Here's a summary of how it works:

1. Single Closing: With a one-time close construction loan, borrowers only need to go through one closing process, which reduces paperwork, time, and potential fees associated with multiple closings.

2. Construction Phase: During the construction phase, the borrower typically makes interest-only payments based on the amount drawn from the loan to cover the costs of construction. This phase allows the borrower to access funds as needed to pay contractors and suppliers.

3. Conversion to Permanent Mortgage: Once construction is complete, the loan automatically converts into a permanent mortgage without the need for a second closing. The borrower transitions from making interest-only payments to regular principal and interest payments.

4. Locking in Interest Rates: Some one-time close construction loans offer the option to lock in interest rates at the beginning of the process, providing borrowers with greater certainty regarding their long-term mortgage payments.

5. Flexible Terms: These loans often offer flexible terms to accommodate the unique needs of borrowers and construction projects, including adjustable-rate and fixed-rate options.

6. Qualification Process: Borrowers typically need to meet certain eligibility criteria, including credit score requirements and income verification, similar to traditional mortgage loans.

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In summary, a one-time close construction loan simplifies the financing process for building a new home or property by combining the construction loan and permanent mortgage into a single transaction, saving time, paperwork, and potential fees for borrowers.

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