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What Are One-Time Close Loans?


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TERMINOLOGY

A one-time close loan is a type of mortgage that is available for those that are building a house. If you were to get a traditional construction loan, you would have to go through two different closings during the process. Whenever you initially start building the property, you are going to have to go through one closing with a lender. Then, whenever the property is completed, you are going to have to go through a second closing to get funds so you can pay off the initial construction loan. The second loan will then be a traditional mortgage loan that you will pay for over a large number of years.

Benefits

By utilizing a one-time close loan, you will eliminate paying two sets of closing costs. Closing costs can add up, they will typically cost anywhere between $3000 to $6000. In addition, you will know everything about the loan before you start building. Some people get a construction loan and then have to settle for a loan that they are not comfortable with just so that they can pay off the construction loan.