Construction Loans in Charleston, SC
Home Loans Inc. originates residential construction loans for new home builds throughout the Charleston Lowcountry - including Summerville's Cane Bay and Carnes Crossroads corridors, Moncks Corner, Hanahan, North Charleston, and all surrounding communities. We offer conventional, FHA, VA, and USDA construction programs - including government construction options that most lenders in the country no longer offer.
One-Time Close vs Two-Close Construction Loans
There are two primary structures for residential construction financing - the one-time close (construction-to-permanent) and the two-close - and the right choice depends on your builder's timeline and your rate outlook.
One-time close: combines construction financing and permanent mortgage into a single closing. You lock your permanent rate at the beginning, close once, and the loan automatically converts when construction is complete. No second closing, no second set of closing costs, no re-qualification required when construction finishes. One appraisal completed upfront as if the home were already built - no re-appraisal needed at completion.
Two-close: a short-term construction loan first (typically 12 months), then a separate permanent loan at completion. Two closings, two sets of closing costs, and re-qualification required at the end of construction. More complex - but allows you to take whatever market rate is available at completion if you believe rates will fall significantly during the build.
We recommend one-time close for most Lowcountry borrowers because of its simplicity, rate lock protection, and single closing cost structure.
Conventional Construction Loans in Charleston
Conventional one-time close construction loans are the most common program for Lowcountry buyers building in established subdivisions and on private lots throughout Berkeley, Charleston, and Dorchester counties.
Minimum credit score: 700 for most conventional construction programs. Down payment: typically 5-20% depending on loan amount and credit profile. Land equity can be used as part of the down payment if you already own the lot or are purchasing it simultaneously. Existing land loan balances can be paid off and rolled into the construction loan.
Summerville's Cane Bay Plantation, Carnes Crossroads, and Nexton communities - as well as custom builds throughout unincorporated Berkeley and Dorchester County - are common conventional construction loan markets we serve.
Builder must be approved through our lender's builder approval process - we manage this coordination on your behalf.
FHA Construction Loans - Low Down Payment New Construction
FHA one-time close construction loans bring the same 3.5% down payment and 580+ credit score accessibility of standard FHA loans to new construction - making custom home building accessible for buyers who cannot meet conventional down payment requirements.
FHA construction loans are ideal for first-time buyers who want to build rather than buy existing inventory. They are particularly relevant in Summerville, Moncks Corner, and the Berkeley County corridor where new construction lots are more affordable and builders are active.
Key FHA construction features: 3.5% down with 640+ credit score. One appraisal completed upfront - no re-appraisal at completion. No re-qualification once construction begins. Third party contributions toward closing costs are permitted. Standard FHA mortgage insurance applies on the permanent loan.
VA Construction Loans - Zero Down for Veterans Building in the Lowcountry
VA one-time close construction loans allow eligible veterans and active-duty service members to build a custom home with zero down payment - the same zero-down benefit of the standard VA purchase loan applied to new construction.
This is one of the most powerful and most underutilized benefits available to veterans. Most major lenders and banks suspended their VA construction loan programs in 2024 and 2025 as investors pulled back from the product. Home Loans Inc. maintains access to VA construction financing through our wholesale lender network - giving Lowcountry veterans an option most other brokers and banks simply cannot offer.
VA construction loan features: zero down payment for eligible veterans. No PMI ever. One-time close - single closing, single appraisal. Permanent VA loan at completion with all standard VA benefits. Land equity counts toward the VA entitlement calculation.
Veterans building near JB Charleston, NWS Goose Creek, or planning retirement builds throughout the Lowcountry should call us specifically about VA construction - this is a specialty product and we know it well.
USDA Construction Loans - Zero Down in Eligible Rural Areas
USDA one-time close construction loans combine the zero-down financing of the USDA Rural Development program with new construction - allowing qualifying buyers in eligible areas to build a custom home with no down payment.
Like VA construction, USDA construction loans have been suspended by most wholesale lenders. Home Loans Inc. maintains access to this program for eligible Lowcountry addresses. USDA construction is particularly relevant for buyers building in the Moncks Corner, Ridgeville, Ravenel, and rural Berkeley and Dorchester County corridors where USDA eligibility exists and land for custom builds is available at accessible prices.
USDA construction eligibility requirements mirror standard USDA purchase loans: property must be in a USDA-eligible area, household income must be within program limits (approximately $104,000-$120,000 for most Lowcountry households of 1-4), and the home must be a primary residence. We verify address eligibility before recommending this program.
The Construction Loan Process at Home Loans Inc.
Construction loans have more moving parts than a standard purchase loan - and managing those parts proactively is the difference between a smooth build and a frustrating one.
Step 1 - Pre-qualification: we review your credit, income, assets, and the proposed build scope. We identify the right program (conventional, FHA, VA, or USDA) and pre-qualify you before you sign a builder contract.
Step 2 - Builder approval: your builder must meet lender approval criteria. We manage this process and have worked with builders throughout the Lowcountry.
Step 3 - Appraisal: completed upfront based on the plans and specs as if the home were already built.
Step 4 - Closing: single closing covers both the construction phase and the permanent loan.
Step 5 - Draw management: as construction progresses, inspections confirm completed work before draws are released to your builder. Your builder is never paid for work not yet completed.
Step 6 - Completion and conversion: the loan automatically converts to the permanent mortgage when construction is complete. No re-qualification, no second closing.
Timeline: most one-time close construction loans close within 45-60 days of application. Build timelines vary by builder and scope - typically 6-12 months for a custom home in the Lowcountry market.
Q: Can I use a VA loan to build a new home in the Lowcountry?
A: Yes - Home Loans Inc. has access to VA one-time close construction loans that most lenders no longer offer. This allows eligible veterans to build with zero down payment, a single closing, and all standard VA benefits on the permanent loan. Call us specifically about VA construction - this is a specialty program.
Q: Can I use land I already own as my down payment?
A: Yes. If you own land free and clear or with an existing loan balance, the equity in that land can be applied toward the down payment requirement. Existing land loan balances can typically be paid off and rolled into the construction loan at closing.
Q: Do I need a specific builder for a construction loan?
A: Your builder must meet lender approval criteria - licensing, insurance, financial review. We manage the builder approval process and have established relationships with builders throughout the Lowcountry. Most reputable licensed general contractors can be approved.
Q: What is the difference between a construction loan and a renovation loan?
A: Construction loans finance the building of a new home from the ground up on a vacant lot. Renovation loans (FHA 203k, HomeStyle) finance the purchase and renovation of an existing home in a single loan. If you are buying an existing home that needs work, see our Renovation Loans page.
Q: Is USDA construction still available?
A: Yes - through our wholesale lender network. Most lenders suspended USDA construction programs in 2024-2025. Home Loans Inc. maintains access to this program for eligible addresses in Moncks Corner, Ridgeville, and rural Berkeley and Dorchester County. We verify your address eligibility before recommending this program.
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COMPANY
NMLS: 1281448 | COMPANY NMLS: 1728740
Home Loans Inc: Jason Sharon, Mortgage Broker |
2557 Ashley Phosphate Rd,
North Charleston, SC 29418 |
(843) 569-7283 | www.homeloansinc.com
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