Yes — conventional construction-to-permanent and two-close products are common. See down payment, credit expectations, and when conventional fits best.
Can Conventional Finance Construction? | 2MG
Yes — conventional construction-to-permanent and two-close products are common. See down payment, credit expectations, and when conventional fits best.
Can Conventional Finance Construction?
How Conventional Construction Financing Works
At a Glance
One-Close vs. Two-Close at a High Level
From Pre-Approval to Permanent Conventional Loan
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Frequently Asked Questions
Get Pre-Approved for Conventional Construction
Yes — conventional construction-to-permanent and two-close products are common for borrowers who want a Fannie Mae or Freddie Mac permanent loan when the build is done. Higher credit expectations and down payments often around 20% apply, but lender overlays allow flexible builders and plans when guidelines are met.
Conventional construction loans fund ground-up builds through either a one-close construction-to-permanent structure or a two-close path with separate construction and permanent loans. Lot purchase, hard costs, and soft costs roll into the construction phase; funds release in draws as milestones pass inspection.
This path fits borrowers outside VA, FHA, and USDA eligibility — or anyone who prefers conventional long-term pricing without government mortgage insurance. Credit, reserves, and down payment requirements are typically stricter than government programs, but builder and plan flexibility is often broader when lender overlays allow.
Ryan and Steve compare one-close vs. two-close structures against your timeline, rate-lock goals, and builder payment schedule before you commit to plans.
Both structures are conventional — the difference is how many times you close and when your permanent rate is set.
Conventional construction files need strong documentation and builder approval before draws begin.
Step
Dig into down payment, closing structure, and fit before you choose a builder.
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Compare one-close vs. two-close structures, down payment, and builder fit before you order plans. Ryan & Steve walk conventional construction borrowers through pre-approval — averaging a 20-day close on straightforward files.