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One-Time Close construction lending
One loan and one closing cover your buyer's land, construction, and permanent mortgage — with no requalifying once the home is done. Structured right, it can build the construction interest into the price (so your buyer makes no payments during the build) and roll in closing costs, which makes it a strong fit for buyers with limited cash who want to buy land and build. Here's how the program works — for both site-built and manufactured/modular homes.
- FHA OTC
- VA OTC
- USDA OTC
- Conventional OTC
Photo: Troy Mortier / Unsplash
What it lets you offer buyers
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Turnkey, fixed price
You build to a firm, all-in contract price — no cost-plus, no allowances. The buyer knows the number up front and you control the budget.
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No payments during the build
Construction-period interest can be built into the contract price as a reserve, so the buyer makes no loan payments while the home is going up.
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Land + construction
The loan covers the land and the full cost of construction in one. Closing costs can usually be rolled in as well, as long as the completed home appraises with them included.
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One close, locked up front
The buyer qualifies and closes once, before construction starts, with permanent financing already set. For you, that means no requalification risk and no appraisal risk hanging over the deal while you build.
Programs & product guidelines
PRMI offers One-Time Close across all four programs, each with a 620 minimum credit score. These are general guidelines — final terms depend on the buyer's qualification and program eligibility.
| Program | Max LTV | Highlights |
|---|---|---|
| VA OTC | 100% | $0 down*, no mortgage insurance — eligible Veterans & service members |
| FHA OTC | 96.5% | Low down payment, flexible credit |
| FHA OTC + DPA | 100% | With down payment assistance — up to 100% financing |
| USDA OTC | 100% | $0 down* — income- and location-eligible rural areas |
| Conventional OTC | 95% | Strong-credit borrowers; drop mortgage insurance at 20% equity |
The permanent rate is locked at a worst-case rate up front, and every file is reviewed for a float-down at completion — the market doesn't have to improve for the buyer to benefit. *$0 down reflects maximum financing — closing costs and fees may still apply. Loan limits vary by program and county. All loans are subject to underwriting approval. This is not a commitment to lend.
How One-Time Close works
The structure is what makes OTC different from a traditional construction loan followed by a separate take-out mortgage.
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One approval, one closing
Construction and permanent financing are a single loan, closed by PRMI before construction begins.
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Converts automatically at completion
When the home is finished, the loan rolls into its permanent mortgage — no second closing, no re-qualification, no extra closing costs.
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You run the build
As the builder or retailer, you act as the general contractor and manage all the work and subcontractors. By program rule, the borrower can’t manage the construction or hire the trades.
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PRMI + a dedicated construction team
PRMI underwrites and services the permanent loan; our construction administrator, National Capital Funding, handles the construction side and your draws — they’ve administered One-Time Close loans since 2002.
Draws & inspections
Construction is funded in stages against a budget you set up front. No money is advanced for work that isn't in place yet.
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You set the budget up front
Before closing, you complete a line-item construction cost breakdown. Every draw is measured against it.
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Funds follow work in place
No money is advanced up front — draws are paid on the line-item percentage of completion, for work actually in place. One exception: permits, impact fees, and similar costs can be reimbursed at closing or paid directly to the municipality, with receipts or invoices provided before closing.
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Inspected, verified, released
When you request a draw, an inspection is ordered, compared against your cost breakdown, and the funds are released.
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Up to 5 draws site-built, 3 manufactured/modular
Site-built homes include up to five draws; manufactured and modular homes include up to three. Need more? Additional draws are available for a small fee.
Manufactured and modular builds can go a step further: the factory invoice can be paid off before the home leaves the factory, with proper transportation insurance in place.
What's required during construction
Requirements depend on the home type and the loan program. Pick your build below to see what applies.
Common to every build
- A fixed-price, turnkey contract with plans and specifications
- You act as general contractor; the borrower can’t manage the work or hire the trades
- Builder’s risk insurance on the build (can be obtained by the builder or the borrower)
- Completion and lien-release paperwork at the final draw
For your specific build
Site-built · Conventional
- A 1004D final inspection at completion
Your construction team confirms the full, current list for your file.
Program availability varies by state and by borrower qualification. All loans are subject to underwriting approval. This is not a commitment to lend.
Getting registered
Registration starts with a builder call. Before your first build, you register once with PRMI's construction team — a quick step we walk you through on the call. Here's what you'll provide:
- General company information — history, experience, and bank & trade references
- Insurance — general liability ($1M per occurrence required) and workers’ compensation (if applicable)
- General contractor license, or retailer’s license (when applicable)
- For site-built builders: two years of company financials
Construction desk: 855-246-PRMI · ConstructionTeam@primeres.com