Financing in Jacksonville>Question Details

Ashleyvictor…, Other/Just Looking in Jacksonville, FL

Do most new home builders accept FHA financing? I have been pre-approved for an FHA loan and would really love to have a new home built. Possible?

Asked by Ashleyvictoria, Jacksonville, FL Mon Mar 15, 2010

This will be my first home. I have heard that not everyone accepts FHA loans. Do most new home builders accept FHA financing or do most require other types of loans?

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Don't think you'll have any problems using your FHA loan on a newly built home. We had an FHA loan on our first new built house and was given incentives for using their preferred (in house) lender. Just be cautious of the rate and the program as home builders are notorious in "building" those incentives back into the loan. I've always felt there was a major conflict of interest when the builder becomes your lender or has a lender in their back pocket.
1 vote Thank Flag Link Thu Mar 25, 2010
It is very important that you ready what I have to tell you.
I just closed a deal for a client last week under a NEW 'unmatched' program that has been specifically designed for first time homebuyers. Highly recommend you call Tom R. Callahan at 904-591-6722 and speak to him in regards.
I can share a few of the details as I know it to be:
1. NO MI !!
2. 5% down
3. 30 yr fixed at a very attractive rate
4. NO Origination fee + NO bank fees or junk fees !
5. NO mortgage payment for 5 months. Apaprently BBVA is eating the interest. Unbelievable !
6. gift funds allowed
7. NO income limitations
My client is so happy now and enjoying thier new home because of this new program. I am sure that it can be used for new construction. Best of luck to you and call Tom.
Oh yea....his email is

Take care, DB
1 vote Thank Flag Link Tue Mar 16, 2010
Over 80% of loans made are FHA. Those builders want at least 80% of people to be able to buy. Of course they will accept it.
1 vote Thank Flag Link Mon Mar 15, 2010
Good evening Ashley,

You'd want to check with a lender on this. If you're taking out a construction to perm loan, it may not be likely that you can use FHA. I have a couple of wonderful lenders I work with on a regular basis ~ they'd know how to advise you.

Please call if you'd like me to put you in touch with them.

Have a great evening!

Lynn Brier-De La Cruz, REALTOR
Web Reference:
1 vote Thank Flag Link Mon Mar 15, 2010
It is any sellers preference for the buyer to have conventional financing; saves money, time and paperwork. Most of America is in a buyers market right now and most sellers will take whatever financing comes with a buyer. It is very likely that every home builder you encounter, in your price range, would accept your f.h.a. financing. The costs of inspection(s) and appraisals are typically more and the paperwork is insane. If you can find the right program it might be to your advantage as a buyer to go conventional; if you can avoid p.m.i.(m.i.p.). I know of at least one lender who has this option with low down payment needed. Best of luck to you!
0 votes Thank Flag Link Mon Mar 15, 2010
I have not met one that didn't yet. I must say that in my area, they new homes are indeed way overpriced and I see as soon as they close, there is a loss between $50,000 - $100,000. Others may disagree with that but that is what I have seen here. So... that is an important investment decision to consider seriously!!!

Good Luck!!!
Web Reference:
0 votes Thank Flag Link Mon Mar 15, 2010
Ashley, most production builders in communities do what is called an 'end loan' which means they cover the costs of building a home until the end of the building process, when you close and move into the home. These end loans can be conventional, FHA, or VA, depending on the community and the builder.

Most builders have their own lenders, as other answers have said, and definitely give incentives for you to use their lender. HOWEVER, you can keep them competitive by letting them know you are getting quotes from other lenders. This is one of the many tips an experienced new home sales Realtor® can help you with.

If you are building with a custom builder, say on your own lot, these builders will usually want to do a 'construction perm' loan which means you will close on the lot and the builder will take draws along the way while the home is being built. This type of loan is, in my experience, a conventional loan, and I am not sure it would work for FHA. That would be a lender question. You would need to know how to protect yourself with a builder when doing a construction perm loan - to be sure the draws were made at the right time, that lien releases were signed, that the house was being inspected by the bank before each draw and that the work was finished according to the draw schedule, etc. These are some of the other tips an experienced agent will give you.

In this economy, builders will do an end loan for homes which they normally would prefer to do a construction perm, just to get the business.

If it's your first home, most people are building in a subdivision, and if there is a preferred lender, they can pre-qualify you for an FHA loan and your question about whether FHA is in that community will be answered.

New home sales are a passion of mine - can you tell? If you have any other questions, it would be a pleasure to help you. There are some articles on building a new home in my blog on our website.

Best regards,

Sharon Alters, CDPE, GRI
Frank and Sharon Alters
Team Alters
Watson Realty
Web Reference:
0 votes Thank Flag Link Mon Mar 15, 2010
In my opinion, Shonda gave you the best answer and if you have representation from the first visit Shonda can help you negotiate your upgrades and also your closing costs.

I have helped many homewoners purchase new homes here in my area and I always get them a better deal than if they simply walked into the sales offices themselves. I am also a witness to the contract and I can explain it.

The builder's usually want you to use their lender in order to get incentives and an agent can make sure you are getting the best interest rate also.

Remember that the sales agents in the New Home Builders offices work for the Builder, (seller). But take your agent with you on the first visit.
Web Reference:
0 votes Thank Flag Link Mon Mar 15, 2010
oops, just scrolled down and read all the answers. Your 1st answer from Lynn covers this as well. Good answer Lynn!
0 votes Thank Flag Link Mon Mar 15, 2010
Wow, cant believe I'm the only one to think of this after so many answers. Builder is not worried about FHA it is FHA that must accept the builder. If it is tract housing in a subdivision it is usually no problem (with the exception of some condos) since the builder will have the entire subdivision approved for FHA/VA but if you are using a small time builder on an individual lot it would be frugal to ask him if there is a problem with using FHA financing or if they have built a house using FHA financing before. It would be terrible to build a house and FHA will not approve you because the builder is not approved.
0 votes Thank Flag Link Mon Mar 15, 2010
You need to find a good Realtor. They can help you negotiate the best deal from the builder. The builder has already built into the price a commission for your Realtor and you'll pay it whether you use one or not. The builders agent, although very nice and very helpful, does NOT work for you and you will NOT get the best deal unless you tell them you're not signing anything without your Realtor. If you have any questions call or email me
Eric Cavanagh
Web Reference:
0 votes Thank Flag Link Mon Mar 15, 2010
Yes they do accept FHA and most builders are willing to pay most closing cost if you use their preferred lender. Some builders even have inventory available now. You can get a really good deal on builder inventory homes and close before the tax credit ends.

Give me a call or email me. I would love to assist you in finding the right builder.

Shonda Sauls, REALTOR®
Prudential Network Realty
Cell (904)962-6139
Office (904)260-4300 #327
Fax (904)292-2060
0 votes Thank Flag Link Mon Mar 15, 2010

it is not an issue. They will take FHA and VA, no problemo.

Blaine Rabe
REMAX Specialists
0 votes Thank Flag Link Mon Mar 15, 2010
Yes, absolutely.

Daniel Workman
Magnolia Properties
0 votes Thank Flag Link Mon Mar 15, 2010
Hi Ashley,
Yes most if not all builders accept FHA financing and will cover the construction phase with their financing typically.
I can assist you with any builder and especially one that builds only concrete block homes.


Call or text me at 9047101574 or email at
0 votes Thank Flag Link Mon Mar 15, 2010
Yes Ashleyvictor!

They are very happy to do FHA loans as long as you qualify! They also offer to pay closing costs and certain discounts to buydown the interest rate etc!

Please allow me to asssit you in your purchase of a new home!

Web Reference:
0 votes Thank Flag Link Mon Mar 15, 2010
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