What is the VA funding fee for 2026?

The VA funding fee for first-time use with 0% down is 2.15% of the loan amount. With 5% down it drops to 1.50%. With 10% down it drops to 1.25%. Subsequent use with 0% down is 3.30%. Veterans with 10% or greater service-connected disability, Purple Heart recipients on active duty, and eligible surviving spouses are exempt from the funding fee entirely.

Why does the VA loan show no mortgage insurance?

VA loans do not require monthly mortgage insurance, which is one of the biggest savings versus conventional and FHA loans. The one-time VA funding fee (which can be rolled into the loan) replaces ongoing mortgage insurance entirely.

What DTI limit does PBT Bancorp use for VA loans?

PBT Bancorp allows debt-to-income ratios up to 55% for borrowers with credit scores of 640 or higher, and up to 50% for credit scores under 640. Borrowers above these thresholds should call PBT at 800-697-4371 for a personalized assessment.

VA One-Time Close Construction Loans

Build a brand-new home using your VA benefit, with the land, the construction, and your permanent mortgage all rolled into a single loan and a single closing. You lock your terms once at the start, so you are not left re-qualifying or paying a second set of closing costs after the house is finished.

Get Pre-Qualified Today Call 800-697-4371

Licensed in all 50 states
PBT Bancorp NMLS# 257781

Active-duty service member in uniform standing in front of a home, representing veterans who build with a VA one-time close construction loan from PBT Bancorp

100%Finance up to the appraised value of the finished home

One-TimeClosing covers the land and the build together

580Minimum credit score, when most lenders want 640 or higher

No Re-QualifyingUnlike a traditional construction loan that makes you re-qualify once the build is done

What is a VA one-time close construction loan?

A VA one-time close construction loan is a single loan that pays for the lot, the cost of building the home, and the permanent mortgage you keep once construction is done, all under one closing. It is sometimes called a single-close or construction-to-permanent loan, and it carries the same core VA benefits you would get buying an existing home, financing of up to 100% of the finished appraised value and no monthly mortgage insurance. The big difference from a standard purchase is that the home does not exist yet, so the loan is built around your plans, your builder, and an appraisal based on what the finished home will be worth.

Because everything is set up at the very beginning, you sign once and your loan terms are locked in. During the build, we release funds to your builder in stages as the work gets completed, and when the home is finished the loan simply converts to your permanent VA mortgage with no second closing and no need to re-qualify.

Military family standing outside their newly built home, the kind of home Veterans build with a VA one-time close construction loan from PBT Bancorp

One-time close vs two-time close, why one closing matters

Many lenders only offer a two-time close, where you take a short-term construction loan to build, then refinance into a separate permanent loan once the home is done. That means two applications, two sets of closing costs, and a second trip through underwriting at whatever rates happen to be available months later. A VA one-time close avoids all of that.

Two-time close (the common way)

A construction loan first, then a separate refinance into your permanent mortgage after the home is built.

Two closings and two sets of costs
You re-qualify after construction
Your rate can move before you lock again
More moving parts to coordinate

VA one-time close

One loan and one closing for the land, the construction, and the permanent mortgage you keep for the life of the loan.

One closing, one set of costs
No re-qualifying after the build
Your terms are locked at the start
Finance up to 100% of the finished appraised value

What you can build with a VA construction loan

This loan is for Veterans and active-duty service members who would rather build the home that fits their family than settle for an existing home on the market. It has to be the home you intend to live in as your primary residence, and a few common situations fit it well.

Build a brand-new primary home

Put up a new construction home that matches how your family actually lives, from the floor plan to the lot, instead of competing for limited existing inventory.

Buy the lot and build together

If you have found land but not a house, the same loan can cover the lot purchase and the build, so you are not juggling a separate land loan on the side.

Build in a growing or rural area

Many military families look just outside a base or in areas where there is more land than finished homes, and building can be the most realistic path to ownership there.

Get a home that is move-in ready

A new build often means newer systems and fewer surprises than an older home, which can be a real advantage when you are managing a move or a PCS timeline.

How a VA one-time close construction loan works

The process has more pieces than a standard purchase because we are financing a home that is still being built, but we handle the VA side for you and keep it as simple as it can be.

Get pre-qualified and pick your builder

We pull your Certificate of Eligibility (COE) and look at your numbers, and you choose a licensed, insured builder who is registered with the VA to do the work.

Plans, specs, and the appraisal

Your builder provides the plans and a cost breakdown, and the home is appraised on what it will be worth once finished, which is what your financing is measured against.

One closing, then the build

You close a single time and your terms are set, then we release funds to the builder in draws as each stage of construction is completed and inspected.

The home finishes and converts

When the build is done, the loan converts to your permanent VA mortgage automatically, with no second closing, no new application, and no re-qualifying.

Estimate your VA construction loan

This is the part most lenders hide. Put in your land cost, your builder’s bid, and the value the finished home is expected to appraise for, and the calculator breaks down the full loan for you, the 5% contingency, the construction interest reserve that covers your payments while you build, the VA funding fee, and how much you can finance versus bring to closing. These are estimates, so your loan officer will confirm the real numbers for your file.

VA Construction Loan Calculator

See how much you may qualify for and what it takes to finance a VA one-time close construction loan.

Why work with PBT Bancorp for your build

A construction loan is more involved than a typical mortgage, so it helps to work with a team that has done a lot of them. Our team has decades of experience with Veterans and has helped over 3,000 families buy or build a home and refinance to save money, and we know how to keep a VA build moving.

We are an FDIC member bank and a wholesale broker, and we work with the lenders who actually offer a true VA one-time close
A real VA one-time close is a specialty product that most lenders do not offer, so it helps to work with a team that does these regularly
We pull your Certificate of Eligibility (COE) and handle the VA paperwork and builder requirements for you
You work with a dedicated VA specialist from start to finish
Licensed in all 50 states for Veterans and active-duty service members

Veteran couple reviewing VA one-time close construction loan options with their PBT Bancorp loan officer

VA construction loan questions

How much do I need to put down on a VA construction loan?

A VA construction loan is based on the finished appraised value of your home, and in many cases you can finance up to that value, which can mean little or nothing down. Unlike a standard VA purchase, though, a construction loan can call for some money down depending on the lender and how your build cost compares to the appraised value, so we will go over exactly what to expect for your situation before you commit.

How is a one-time close different from a two-time close construction loan?

A one-time close uses a single loan and a single closing for the land, the construction, and the permanent mortgage, while a two-time close means you finance the build first and then refinance into a separate permanent loan later, which is two closings, two sets of costs, and another trip through underwriting at whatever rate is available by then.

Do I have to use a specific builder?

You can choose your own builder, but they need to be registered with the VA and carry the right license and insurance, and most programs also want a builder with a couple of years of homebuilding experience who provides a new construction warranty. We will help you confirm your builder qualifies before you get too far down the road.

What if I already own the land?

Owning your lot can lower what you bring to closing, because the appraised value of the land can count toward the loan much like a down payment, and that can reduce the VA funding fee you owe at closing. We will look at your land value and factor it in when we put your numbers together.

Can I buy the land and build with the same loan?

Yes, in many cases the lot purchase can be rolled into the same VA construction loan as the build, so you are not carrying a separate land loan, though the details depend on your situation and the property.

When do my mortgage payments start?

You make no monthly mortgage payments while your home is being built, which can run up to about 11 months. The interest for the construction period is built right into your loan budget, so your first regular principal and interest payment is not due until the build is finished and the loan converts to your permanent VA mortgage.

What credit score do I need for a VA construction loan?

The VA does not set a minimum credit score, and most lenders want stronger credit on a construction loan than on a standard purchase, often 640 or higher. Our VA one-time close program goes down to a 580 credit score, so we can often help build-ready Veterans who would get turned away elsewhere, as long as the rest of your file fits.

Does the VA funding fee apply to a construction loan?

Yes, the VA funding fee applies the same way it does on a VA purchase, and it is waived for Veterans with a 10% or greater service-connected disability, so we will confirm whether it applies to you before you commit to anything.

What kinds of homes can I build?

Quite a few. Along with a standard site-built home, our VA one-time close can be used for modular and manufactured homes, a primary residence with up to four units, and even unique builds like a barndominium when the appraisal can support the value with comparable sales. Tell us what you have in mind and we will let you know quickly whether it works.

What happens to the 5% contingency if I do not use it?

The 5% contingency is set aside in case of possible cost overruns during the build. Any unused funds are applied as a principal reduction to your final loan balance once the home is finished and the loan converts to your permanent VA mortgage.

VA construction loans by state

We build with Veterans nationwide, and we are adding state-specific pages as we go. See our North Carolina VA construction loans and Florida VA construction loans pages for local detail.

Looking at your other options too? See our VA purchase loans, the VA IRRRL streamline refinance, and the VA cash-out refinance, or browse all of our VA loan programs.

Ready to build with your VA benefit?

Tell us about the home you want to build and we will look at your eligibility, your numbers, and what a one-time close would look like for you, with no pressure and no obligation. Give us a call at 800-697-4371 or start online and let us handle the VA side of your build.

Start Your Pre-Qualification

Page last reviewed: June 6, 2026. Market data refreshed monthly. Loan limits and tax rates verified against 2026 county records.