VA construction financing
VA One-Time Close Construction Loans
One VA mortgage can cover the land, construction, and permanent financing with a single closing before work begins. PBT Bancorp offers this nationwide to eligible Veterans, active-duty service members, and surviving spouses.
Apply now to get pre-qualified for your VA construction loan. Some applications can be considered with a credit score as low as 580.
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What is a VA one-time close construction loan?
A VA one-time close construction loan is one mortgage that can pay for a lot approved for the planned home, the cost to build the home, and the permanent financing you keep after construction. You close before the work starts, the builder receives funds in approved draws as construction moves forward, and the loan changes to regular principal and interest payments after the home is complete.
The loan can cover up to 100% of the project cost, depending on available entitlement and the as-completed appraised value. If the cost is higher than the appraised value, or the budget includes something the loan cannot cover, we show you the difference before closing. The finished home must be your primary residence, and VA loans do not require monthly private mortgage insurance (PMI).
Use the calculator to estimate the lot purchase or current land payoff, builder’s bid, 5% contingency, construction interest reserve, VA funding fee, appraised value, and possible cash needed before you request a full quote.
Can you buy land and build with the same VA loan?
A lot purchase can be included with the construction budget in the same one-time close loan when the land, builder, plans, contract, appraisal, title, and permits are approved together. If you already own the lot, we review the current land value, any balance still owed, the construction contract, and the finished appraisal to calculate how the equity affects the financing.
Owning the land does not automatically mean the loan will cover every cost. We compare the land value, construction budget, and finished appraisal so you know whether the land helps and whether any money will still be needed at closing.
Get pre-qualified for your VA construction loan
Have a homesite or new-home project in mind? Apply online to get pre-qualified for your land and new home.
What does your builder need for a VA construction loan?
Your builder must be properly licensed where the home is being built. We also review the builder’s experience, insurance, contract, plans, budget, schedule, warranty, and draw process before the loan can close.
- State and local license when required
- Insurance that meets the construction program
- Detailed plans and material specifications
- Signed contract and complete cost breakdown
- Realistic construction and draw schedule
- Builder’s risk coverage effective at closing
- Required new construction warranty
- Local permit and inspection plan
The VA removed the Builder ID requirement for regular VA-guaranteed new and proposed construction on March 31, 2025. Your builder does not need a VA Builder ID for this type of loan, but we still have to approve the builder and the project.
Read VA Circular 26-25-1 on the removal of the Builder ID requirement.
What can slow down a VA construction loan?
Incomplete plans, missing builder documents, missing insurance, pending permits, or an appraisal that comes in below the total project cost can delay closing.
Changes after construction begins can add cost or require updated plans and approval. Talk with us before authorizing a change so you know whether it can be financed or will need to be paid out of pocket.
- Incomplete plans or cost breakdown
- Builder approval or insurance not ready
- Appraisal below the full project cost
- Permits or local approvals still pending
- Unapproved change orders after closing
- Unusual property without good comparable sales
What costs are built into the construction budget?
The construction budget typically includes the builder’s contract, approved lot price or current land payoff, a 5% contingency, and a construction-period interest reserve. It can also include required insurance, permits, draw-management fees, the VA funding fee when applicable, and other approved costs. We identify every item that must be paid in cash before closing.
After the final draw, we reconcile the construction account. Unused loan-funded contingency reduces principal under our current program, while any reserve you paid in cash follows the construction contract. The interest reserve helps cover interest while the home is being built, which is why regular principal and interest payments generally begin after construction and the permanent loan modification are finished.
Have a lot and builder ready for review?
Apply with the lot price and builder’s budget so we can check the loan amount and payment before work begins.
Why work with PBT Bancorp for your build?
During his 16-year mortgage career, Michael Parker has helped more than 3,000 families buy or refinance. You work with a dedicated VA specialist who helps you use your benefit to build the home you want.
PBT Bancorp is an FDIC member bank licensed in all 50 states. Credit scores as low as 580 may be considered, and we can review loan requests up to $4 million.
- A dedicated VA specialist from the first review through closing
- 580 minimum credit score required
- Nationwide licensing for eligible builds in all 50 states
- No monthly mortgage insurance
VA construction loan questions
Who offers VA construction loans?
PBT Bancorp offers VA one-time close construction loans nationwide. You can finance the land for your new primary home, its construction, and the permanent mortgage with one closing before work begins.
How much do I need to put down on a VA construction loan?
A VA construction loan can finance the full project with no down payment, depending on available entitlement and the as-completed appraised value. If the project costs more than the appraised value or includes something the loan cannot cover, we show you how much would be due in cash.
Can I buy land and build with the same VA construction loan?
A lot purchase can be included with the construction budget in one loan when the land, builder, plans, contract, appraisal, title, and permits are approved together. The purchase and construction contracts establish the starting cost. Approved plans, budget, and the completed-home appraisal then determine the amount financed.
Can I use land I already own?
Yes, land you already own can be part of the transaction, and its value may help when we compare the eligible acquisition cost against the completed appraisal. Any existing land balance and title requirements also have to be included in the review.
Does my builder need a VA Builder ID?
No, your builder does not need a VA Builder ID for this type of loan. VA Circular 26-25-1 removed that requirement for regular VA-guaranteed new and proposed construction, while state and local licensing rules and our builder and project review still apply.
Can I act as my own builder?
No, owner-builders are not allowed under our current VA one-time close program. The project needs an approved builder who can provide the required construction documents, insurance, warranty, budget, and draw schedule.
What credit score do I need for a VA construction loan?
The VA does not set one minimum credit score for every VA loan. Our current one-time close construction program may consider a score as low as 580. We also review your recent housing history, income, monthly debts, available funds, and the proposed build.
When do my mortgage payments begin?
Our current program includes an interest reserve in the construction budget, so regular principal and interest payments begin after construction and the permanent loan modification are complete. We show the interest reserve and expected payment start before you close.
Does the VA require a final inspection?
Yes, we require final completion documentation, which includes a final inspection or other approved evidence that the home was completed according to the plans and applicable requirements. A certificate of occupancy and any remaining survey or title items may also be required.
Can change orders be added after closing?
We must review and approve a change order before the builder completes the changed work because it can affect the approved budget, appraisal, contingency, timeline, and the money you need. An unapproved increase is not automatically added to the loan.
What happens to an unused 5% contingency?
After construction, we reconcile the final account. Under our current program, unused loan-funded contingency reduces the principal balance instead of being paid to you as cash. If you contributed cash to the reserve, we confirm its treatment under the construction contract.
Do I need a local VA construction lender?
Your builder must meet the local requirements where the home is being built. PBT Bancorp can handle the financing nationwide and coordinate with your builder, appraiser, title company, and local inspectors.
Does the VA funding fee apply to a construction loan?
The VA funding fee usually applies unless you qualify for an exemption. We confirm the fee before closing and show you whether it will be paid in cash or included in the loan amount.
What is the maximum PBT VA one-time close construction loan amount?
Our current program can review loan amounts up to $4 million. Your actual loan amount depends on your finances, VA entitlement, the construction budget, and the appraised value of the finished home.
Check the build before construction starts
Start the application with your lot details, builder contract, and estimated schedule. We will review the budget, finished-home value, and cash needed before closing.
Last reviewed August 21, 2026. Current Builder ID guidance was checked against VA Circular 26-25-1. PBT Bancorp NMLS #257781.