You Found the Land — Now You Need a Loan That Covers the Build
You have been looking at a piece of land outside the city. Maybe it is a quiet lot in a growing suburb, or an acre in a rural pocket of South Florida where the trees still outnumber the strip malls. The vision is clear: a home built to your specifications, not someone else’s floor plan. What is not clear yet is how to finance it.
Traditional construction loans often require a separate closing when the build is complete, which means two sets of fees, two rounds of paperwork, and the uncertainty of qualifying again under whatever lending conditions exist at that future date. The USDA One-Time Close Construction Loan is designed to address exactly that problem.
This program combines construction financing and the permanent mortgage into a single loan, closed once. And for borrowers who meet the USDA’s income and property location requirements, it may be done with zero down payment.
How the One-Time Close Structure Works
With a standard construction loan, the process has two distinct phases. You close on a short-term construction loan to fund the build. Once the home is complete, you close again on a traditional mortgage to pay off that construction loan. Two closings means two sets of costs and two separate qualification reviews.
The USDA One-Time Close loan collapses that into a single transaction. You qualify once, close once, and lock into your permanent loan terms before the first nail is driven. During construction, draws are made to your builder at scheduled milestones. When the home is complete and receives its certificate of occupancy, the loan automatically converts to your permanent mortgage without another closing.
This structure could reduce your out-of-pocket costs and eliminate the risk of having to re-qualify mid-build if your financial situation changes.
You can explore how each phase unfolds by reviewing our step-by-step process, which walks through what borrowers typically experience from application through closing.
Who May Be Eligible
The USDA loan program was created to support homeownership in areas that are not classified as major urban centers. That does not always mean remote farmland. In Florida, a number of communities within a reasonable distance of Fort Lauderdale and surrounding metros fall within USDA-eligible boundaries.
To potentially qualify for a USDA One-Time Close Construction Loan, borrowers generally need to meet a few broad criteria:
Location eligibility. The property you plan to build on must be in a USDA-designated eligible area. These maps are updated periodically, so a location that was ineligible in a previous year might qualify today.
Income limits. The USDA program is designed for low-to-moderate income households. The household income limits are based on the county you are building in and the number of people in your household. Exceeding the limit would make the program unavailable to you, but many working families are surprised to find they fall within range.
Creditworthiness. While the USDA does not set a single rigid minimum score, most lenders — including our construction partner — look for a reasonable credit history. Borrowers with scores in the mid-600s may still find a path forward, though each file is reviewed individually.
Primary residence only. The home you build must be your primary residence. Investment properties and vacation homes are not eligible.
Licensed builder requirement. The USDA requires that the home be constructed by a licensed, approved general contractor. You cannot serve as your own builder under this program.
If you are unsure whether you and your intended lot could meet these standards, see your options and Jim Blackburn, NMLS #1072866, will walk through the details with you directly.
The Zero-Down Advantage and What It Actually Means
Among first-time buyers and those who have been priced out of existing home inventory, the appeal of zero down payment is obvious. Saving 10% or 20% of a home’s purchase price can take years. In a market where construction costs have climbed and existing home supply in desirable areas remains tight, waiting years to save may mean watching land prices move out of reach.
A USDA One-Time Close loan could allow an eligible borrower to begin building now, using a verified income stream rather than a large cash reserve as the foundation for financing. This is not a workaround or an obscure loophole — it is a federal program specifically designed to expand access to homeownership in underserved geographic areas.
It is worth noting that “zero down” does not mean zero costs. Closing costs, builder fees, and appraisal expenses are still part of the process. In some cases, those costs may be rolled into the loan or covered by seller concessions, but that depends on your specific transaction.
You can use our mortgage calculators to start thinking through estimated loan amounts and what monthly payments might look like for your scenario.
What the Build Process Looks Like With This Loan
Once your loan is approved and you close, construction begins according to a draw schedule agreed upon by you, your builder, and the lender. The lender releases funds in phases — typically tied to completed milestones like foundation, framing, rough mechanicals, and final completion.
During the construction period, you may pay interest only on the funds that have been drawn, rather than on the full loan amount. This keeps your payments manageable while the home is being built. The length of the construction phase varies by project complexity, but most single-family builds operate on a timeline of six to twelve months.
Once the local authority issues a certificate of occupancy, your loan transitions automatically to the permanent mortgage phase. There is no second closing, no new application, and no re-appraisal in most cases.
This predictability is one of the features that makes the One-Time Close structure particularly appealing to borrowers who want to plan ahead without open-ended uncertainty.
You can learn more about available loan programs at Stairway Mortgage if you want to compare this option against other new construction financing paths.
Working With Stairway Mortgage on Your Build
Stairway Mortgage is based in Fort Lauderdale and works with borrowers throughout Florida who are navigating construction financing. Jim Blackburn, NMLS #1072866, has experience structuring USDA One-Time Close loans and coordinating with builders to keep the draw and closing process on track.
The right preparation matters. Getting pre-qualified before you finalize land contracts or builder agreements puts you in a much stronger position when it is time to move. Understanding the USDA income limits for your county, confirming lot eligibility, and having your financial documents organized early can all reduce delays down the line.
If you are serious about building a home and want to understand whether the USDA One-Time Close Construction Loan might be a fit for your situation, the conversation starts here.
Call (954) 993-1625 or Talk to Our Team to go over your scenario with someone who works with these loans regularly. You can also See My Options to share some basic details and get a clearer picture of what may be available to you.