Can You Buy Land with a VA Loan?


February 22, 2023

If you want to purchase a piece of land only using your eligibility to finance it through an approved VA lender, that type of loan product is not offered.  However, the VA insured loan program will allow for the purchase of land if it is combined with the construction costs to build a brand-new home.  They will allow all those costs to be in one loan and allow for a true $0 down and accomplished with one closing.  This type of loan is called an VA One-Time Close construction to permanent loan. Buying land with a VA loan is done in conjunction with a  VA construction loan, and it is a common new home construction feature for Stick-Builds, modular and manufactured homes.

VA One-Time Close Program Benefits:

●        Combine both the land purchase and the construction costs of the home into one VA loan with a $0 down payment

●        No payments until construction is complete

●        No re-qualifying once the home is complete

●        Middle credit scores for each borrower as low as 620

Finding an experienced mortgage lender for this type of VA construction loan financing is not a simple task.  Most VA lenders concentrate on regular VA home purchases, cash-out refinances and streamline refinances.   Only a select few companies around the nation employ loan officers who fully understand how to put these deals together and provide quality service throughout the process. 

Veteran borrowers should be aware that while the VA has set housing regulations and guidelines – known as VA Pamphlet 26-7, Lenders Handbook, a lender can choose to add additional Overlays or requirements.  The VA guidelines are minimum standards for VA approved lenders to use as a guideline. 

One example states that the VA allows the One-Time Close construction loan product to be either a single-family dwelling, duplex, triplex or four-plex.  But most companies will have an overlay stating that they will only originate owner-occupied single-family dwellings.  Also, each company can set their minimum credit scores requirements at levels higher than what the VA guidelines state.     

Want More Information About One-Time Close Loans?

One-Time Close Loans are available for FHA, VA and USDA Mortgages.  These loans also go by the following names: 1 X Close, Single-Close Loan or OTC Loan. This type of loan allows for you to finance the purchase of the land along with the construction of the home. You can also use land that you own free and clear or has an existing mortgage.

We have done extensive research on the FHA (Federal Housing Administration), the VA (Department of Veterans Affairs) and the USDA (United States Department of Agriculture) One-Time Close Construction loan programs. We have spoken directly to licensed lenders that originate these residential loan types in most states and each company has supplied us the guidelines for their products. We can connect you with mortgage loan officers who work for lenders that know the product well and have consistently provided quality service. If you are interested in being contacted to one licensed construction lender in your area, please send responses to the questions below. All information is treated confidentially. provides information and connects consumers to qualified One-Time Close lenders in an effort to raise awareness about this loan product and to help consumers receive higher quality service. We are not paid for endorsing or recommending the lenders or loan originators and do not otherwise benefit from doing so. Consumers should shop for mortgage services and compare their options before agreeing to proceed.

Please note that investor guidelines for the FHA, VA and USDA One-Time Close Construction Program only allow for single family dwellings (1 unit) – and NOT for multi-family units (no duplexes, triplexes or fourplexes). You CANNOT act as your own general contractor (Builder) / not available in all States.

In addition, this is a partial list of the following homes/building styles that are not allowed under these programs:  Kit Homes, Barndominiums, Log Cabin or Bamboo Homes, Shipping Container Homes, Dome Homes, Bermed Earth-Sheltered Homes, Stilt Homes, Solar (only) or Wind Powered (only) Homes, Tiny Homes, Carriage Houses, Accessory Dwelling Units and A-Framed Homes.

Your email to authorizes to share your personal information with a mortgage construction lender licensed in your area to contact you.

  1. Send your first and last name, e-mail address, and contact telephone number.
  2. Tell us the city and state of the proposed property.
  3. Tell us your and/or the Co-borrower’s credit profile: Excellent – (680+), Good – (640-679), Fair – (620-639) or Poor- (Below 620). 620 is the minimum qualifying credit score for this product.
  4. Are you or your spouse (Co-borrower) eligible veterans? If either of you are eligible veteran’s, down payments as low as $0 may be available up to the maximum amount your debt-to-income ratio VA will allow – there are no maximum loan amounts as per VA guidelines.  Most lenders will go up to $1,000,000 and review higher loan amounts on a case by case basis.   If not an eligible veteran, the FHA down payment is 3.5% up to the maximum FHA lending limit for your county.

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