No. 5. Some Banks Offer One-Time Close Options.
Both Jenni and Steven tout the advantages of the one-time close—including paying only one set of closing costs. The Bancorp Construction Permanent Loan allows 12 months from close to complete the project, but Jenni says, “We understand the nature of construction delays, and we often allow for extensions.” Adds Steven, “The one-time close is 100,000% superior to the two-time close.” and he points to Region’s Construction to Permanent Loan Program. “Borrowers can lock in today’s rate just as soon as we get an executed construction contract, before construction starts instead of waiting till they’re within 60 days of completion."
These programs have many advantages, such as only one set of closing costs, but they require advance planning. If you reserve a homesite and start home plans immediately, you’ll have time to complete the steps required before construction can start and to reap the benefits of a one-time close. Steps include home design, design approval, builder selection, builder contracting, loan application, and home design appraisal. "With pre-sell lots as far in advance as ours, buyers have a great opportunity with this type of financing, but they must act quickly,” Jodi Peters, managing broker of Cinnamon Shore Realty.