A one-time close construction to permanent mortgage (OTC) is a type of home loan that allows borrowers to permanently finance their land and construction of a new home with a single mortgage. This can be a convenient and cost-effective option for borrowers who are building a new home or making significant renovations to an existing home.

With a one-time close construction to permanent mortgage, borrowers typically only need to go through the mortgage application and underwriting process once. The lender provides a single loan to cover the land, cost of construction and the permanent mortgage, and the loan is secured by the completed home. This can save borrowers time and money compared to obtaining separate construction and permanent loans.

One-time close construction to permanent mortgages are typically available in various loan terms, including 15-year, 20-year, and 30-year terms. Borrowers can choose the term that best meets their financial needs and goals. For example, a 15-year loan may have a lower interest rate but higher monthly payments, while a 30-year loan may have a higher interest rate but lower monthly payments.

One of the advantage of a one-time close construction to permanent mortgage is a borrowers land is combined with the construction and final mortgage.  A borrower won't need to pay a separate land loan while the home is being built.

Another advantages of a OTC construction to permanent mortgage is that it allows borrowers to lock in an interest rate at the beginning of the construction process, which can help protect against potential rate increases. It also allows borrowers to lock in a mortgage rate before the home is completed, which can be beneficial if rates are expected to rise.

Additionally an OTC allows borrowers to roll the closing costs into the loan, which can be helpful for borrowers who may not have the funds available to pay closing costs upfront.