Comparing Construction Loans

Homeownership is a commitment to cultivate a haven where memories bloom within the walls of our property.

The table below outlines some of the main differences between One-Time-Close and Stand-Alone, or 2-Close, new construction loans.

Apply Now

	One-Time-Close	2-Close (or Stand-Alone)
Applications	One approval lasts through construction (up to 11 months). If construction is not completed within 11 months from closing, then a new approval will be required.	Lender offering the construction loan may not be the same lender for the long-term financing. Two applications and approvals required. Twice the effort and twice the stress.
Approval Process	Once builder and project are approved, loan is underwritten to standard Fannie Mae Guidelines with Exhale’s flagship Lender.	Construction loans provided by hard-money lenders use their own guidelines which could have more challenging approval process and restrictive lending terms.
Down-Payment Requirement	Up to 95% financing permitted*. 95% applied to the minimum of the completed project cost and future value of the property.	More restrictive in terms of lending. Some ground-up construction lenders require 80% LTC (loan-to-construction cost).
Closings	One closing, one signing, one set of closing costs.	Two closings, two signings, two sets of closing costs.
Appraisal	One	Two
Total Costs	Much Lower. One set of loan origination, appraisal and lender fees and settlement costs.	Much higher. Two sets of loan origination, appraisal and lender fees and settlement costs.
Locking	Mortgage is locked prior to closing; early in process.	Each loan is locked. End-loan locked prior to completion of construction, which could be 6-12 months away.
Early Rate Lock Benefit	Protected from rising rates during construction phase.	Not protected from rising rates.
Rate Lock Float-Down	Rate will automatically float down if rates drop.	Locking at current market (with downside exposure).

Expert Advice

We’re your trusted financial partners for life, dedicated to simplifying your journey towards homeownership. Reach out today!

Exhale Lending is a mortgage brokerage firm that embodies trust, transparency, and a genuine desire to help clients achieve financial serenity. With our client-centric approach, expertise, and unwavering commitment to excellence, Exhale Lending is poised to make a meaningful impact on the journey towards homeownership for individuals and families alike.