Loan options / Construction loans
Build it once.Close it once.
A one-time-close construction loan finances the land, the build, and the permanent mortgage in a single transaction, with one approval and one closing. You pay interest only on funds drawn during construction, then the loan converts to your regular mortgage when the home is finished.
Who it's for
For people building, not buying.
Custom homes, semi-custom builds, and lot-plus-build packages. If you already own the land, its value can count toward your down payment.
Your plans, your builder
Finance a home built to your specifications on your lot with a licensed contractor.
Already own the lot
Equity in land you already own can serve as some or all of the down payment.
VA construction
Eligible veterans can build with no down payment through a VA one-time-close loan.
USDA construction
A USDA single-close construction loan can finance a build in an eligible area with nothing down.
What you'll need
What construction underwriting looks for.
- Credit and incomeSimilar to a standard mortgage for the program you use, with a bit more emphasis on reserves given the build timeline. Patriot's minimum score is set by program and subject to change; your loan officer will confirm it.
- Builder approvalA licensed, insured builder with a track record. We review the builder as part of the loan.
- Plans, specs, and budgetA complete set of plans, specifications, and a fixed-price construction contract.
- Appraisal on the plansThe appraiser values the finished home from the plans and the lot, and the loan is based on that value.
- Draw scheduleFunds are released to the builder in stages as inspections confirm each phase is complete.
- LandOwned outright, purchased with the loan, or under contract.
How it works
From lot to keys. Five stages, one closing.
Talk to your loan officer
One call, one person. We look at your plans, your builder, and your budget together, and you get a name and a direct line.
Get approved and lock your rate
Income, credit, and reserves are verified once. Your permanent rate is locked before construction begins.
Builder review and appraisal
We review the builder's license and track record, and the appraiser values the finished home from your plans and lot.
Draws and inspections
The builder requests funds at set milestones, an inspector confirms the work, and each draw is released. You pay interest only on what has been drawn.
Conversion
When the certificate of occupancy is issued, the loan converts to your permanent mortgage. No second closing, no second approval.
How the money moves
From lot to keys.
Land purchase or payoff
The first draw can buy the lot or pay off an existing land loan.
Construction draws
The builder requests funds at set milestones, an inspector confirms the work, and the draw is released.
Interest-only period
During the build you pay interest only on what has been drawn, which keeps payments low while you may still be paying rent.
Conversion
When the certificate of occupancy is issued, the loan converts to your permanent mortgage with no second closing or new approval.
Questions
Straight answers.
Why one closing instead of two?
A two-time-close loan means qualifying twice, paying closing costs twice, and carrying rate risk during the build. One-time-close removes all three.
Can I lock my rate before we break ground?
Yes. That is one of the main advantages. Your permanent rate is locked at the start and protected through the build.
What if construction runs long?
Build periods run up to 12 months, and extensions are possible for cause. Talk to your loan officer early if the schedule is slipping.
Can I act as my own general contractor?
Generally no. The program requires a licensed builder. Owner-builder arrangements are considered case by case with proven experience.
Does the land I own count as my down payment?
Usually, yes. The appraised value of the lot, less anything still owed on it, counts as equity.
Can I build a manufactured or modular home?
Modular homes on permanent foundations are eligible. Manufactured homes are eligible under some programs. Your loan officer will confirm.
Talk to a construction loan officer in your state.
Licensed by name, in the state you are buying in. No call center, no hand-offs.
Construction loan availability, terms, and builder requirements vary by program and are subject to change. Belem Servicing LLC d/b/a Patriot Home Mortgage, NMLS #715386. Equal Housing Lender.