Quazel Mortgage — Navigation
New Construction Loans | Quazel Mortgage
One-Time-Close Construction Financing

One loan from first draw to front door.

Finance the construction and permanent mortgage with one closing. The rate set at closing cannot increase when construction ends, and eligible pricing may move lower if the market improves.

Start an Application Talk Through My Build
One closing Conventional and VA options Builder and project reviewed upfront
How It Works

Built for the Building Process

A construction loan covers the cost of land and building your home, then converts into a standard mortgage once the home is finished. With our one-time close option, you sign one set of loan documents at the start, not two. Your rate cannot increase during the standard construction and modification process. A second borrower qualification is generally not required when construction is completed within 11 months and the final modification is signed within 12 months of closing.

1
Approve & Lock
We underwrite your loan against the builder's contract and your land, and lock your permanent rate upfront. Every construction budget includes a 5% contingency. Any unused contingency funds reduce your final loan balance.
2
Build
Funds release to your builder in draws as construction hits each stage. With a Conventional loan, you make interest-only payments based on the amount drawn during construction. With an eligible VA loan, construction-period interest is included in the project budget, so no monthly mortgage payment is required during the build.
3
Move In
Once the home is complete, the Certificate of Occupancy and final inspection are received, and you sign the notarized modification agreement, the loan moves into permanent financing. There is no second mortgage closing.

Your rate after construction

Your rate is set.
A lower rate may follow.

Your permanent rate is set when you close. When your home is complete, the lender checks whether you qualify for a lower rate before the loan moves into permanent financing.

Here is how the float-down works.

The lender compares your original rate with the eligible market rate plus 0.125 percentage points, using the same cost basis.

If the adjusted rate is lower and you accept it, your rate comes down. Otherwise, you keep your original rate.

Illustrative example

Your original rate6.750%
Eligible market rate6.500%
Float-down adjustment+ 0.125%
Adjusted market rate6.625%
Your permanent rate6.625%

Your rate drops from 6.750% to 6.625% if you qualify and accept the reduction.

These examples explain the calculation. They are not current rates or a loan offer. Eligibility, lender pricing, and program requirements apply. The rate protection described here applies within the program's construction and modification requirements. Delays beyond those limits may require requalification.

Who This Fits

Different builds need different structures.

The right setup depends on who owns the lot, who is building the home, and which loan program fits the project. We review those pieces together before the loan is structured.

Start an Application
Builder contract homes
A production or custom builder constructs the home under an approved contract and budget.
Owner-builder projects
May be considered for a Conventional loan on a primary residence. Not available under the VA program and subject to lender approval.
VA new construction
Eligible veterans may finance an approved primary-residence build with up to 100% financing, subject to VA and lender requirements.
Land already owned
The transaction is generally structured as a construction refinance. Existing land equity may improve the loan-to-value position but cannot pay closing costs.
Barndominiums
May qualify when the completed property is supported by acceptable comparable sales and the borrower, contractor, and project meet lender requirements.

Builder approval

Have a builder in mind?
Here is what the lender looks for.

Both your builder and your construction project need approval. We can start the builder review while you work on the plans and budget.

3 yearsMinimum time in business
10 homesCompleted construction experience
5 buildsGround-up construction projects

Those are the standard experience benchmarks. If your builder has a shorter history or needs to document their experience, the lender may request a resume and ground-up projects from the past three to five years. Approval is still required.

See the builder's document checklist
Licensing and identification

Current contractor license for the state where the home will be built, plus valid government-issued photo identification.

Insurance

General liability coverage of at least $1 million in aggregate, plus workers' compensation coverage or an acceptable exemption.

Construction and business history

Gross sales and project history for the past three years, current projects, and a completed W-9.

References

Three residential client references for projects completed more than six months ago, plus subcontractor references.

Business credit

A D&B number and a minimum business credit score of 65. If a Paydex score is unavailable, the lender may use a personal soft credit check with a minimum score of 620 and additional credit requirements.

Project approval

The builder's approval is separate from the review of your construction contract, plans, budget, and property.

Requirements shown are for the construction program described on this page. Builder and project approval are subject to lender review. Owner-builder eligibility has separate restrictions.

Common Questions

New Construction, Answered

What if my builder has not worked with this lender before?
That is usually fine. The builder completes an approval package and provides licensing, insurance, business, experience, and reference information. The builder and construction project are reviewed separately, so both must be approved before the loan can close.
Do I need a down payment during construction?
If you already own the lot, the loan will generally be structured as a construction refinance, and your land equity may reduce the cash you need to bring. It cannot be used to pay closing costs. On a construction purchase, you cannot already own the land at closing under this program. Down payment requirements depend on the loan program, and VA can still mean zero down.
What happens if my build takes longer than expected?
The standard build period is up to 11 months. Your rate cannot increase during the standard construction and modification process. If construction runs past 11 months, or the final modification is not signed within 12 months of closing, a second borrower qualification can be required.
Is this different from a regular purchase loan?
Yes. Instead of one lump-sum payout at closing, funds release to the builder in draws tied to construction milestones. Once the home is complete, the Certificate of Occupancy and final inspection are received, and you sign the notarized modification agreement, the loan moves into permanent financing. There is no second mortgage closing.
Can I use this for a custom home on land I already own?
Yes. Custom-home construction loans are available on land you already own, generally structured as a construction refinance. Existing land equity may reduce the cash investment required, but it cannot be used to pay closing costs. Owner-builder transactions may be considered for a Conventional loan on a primary residence. They are not available under the VA program and require lender approval.
Do you finance barndominiums?
Barndominiums may qualify when the completed property is supported by acceptable comparable sales and the borrower, contractor, and project meet the lender's requirements. This comes up a lot in Utah and Idaho, and it's one of our most common questions.

Ready to break ground?

Let's review your lot, builder, contract, and timeline before small questions become expensive delays.

Start an Application Talk Through My Build