Construction Loans in Florida
Build your home with one loan — construction-to-permanent financing with a single closing and draws as you build, priced personally across 200+ wholesale lenders by Jacksonville Mortgage Broker Douglas Wilkerson.
What is a construction loan?
A construction loan is a mortgage that finances the building of a home rather than the purchase of one that already exists. Instead of handing over the full loan amount at closing, the lender releases the money in stages — called draws — as the work is completed and inspected. When the home is finished, the loan converts to a regular permanent mortgage. In Florida, the most common form of this financing is a construction-to-permanent loan, often called a one-time-close loan, because it combines the construction financing and the permanent mortgage into a single loan with a single closing.
That structure is different from a two-close loan, where the borrower takes out a short-term construction loan and then applies for a separate permanent mortgage when the home is done — paying two sets of closing costs and going through underwriting twice. With a one-time close, the rate, the loan terms, and the permanent mortgage are set up front, and the borrower makes interest-only payments on the amount drawn during construction. The alternative — paying cash for the build and then refinancing — ties up far more of the borrower's own money and adds a second transaction. A construction-to-permanent loan keeps the process to one file, one closing, and one relationship from breaking ground to move-in day.
Who construction loans are for
Construction loans are for people who want to build rather than buy. The most common borrower already owns a lot — or is buying one — and has plans, a builder, and a budget for the home they want. Instead of hunting for a resale home that checks every box, they build exactly what they need: the right number of bedrooms, the layout that fits their family, and the location they chose. A construction-to-permanent loan finances the land and the build together, so the borrower closes once and moves into a home that was designed for them.
Construction loans also fit buyers in Northeast Florida's fast-growing planned communities, where new homes are being built in neighborhoods like Nocatee and across St. Johns County. A buyer who has found the right community but wants a floor plan, a lot, or finishes the builder's inventory does not offer can use a construction loan to build on a chosen lot instead of settling for what is already standing. The same is true for a homeowner tearing down an older house and rebuilding on land they already own — the loan finances the new home while the land stays in the family.
Down payments, draws, and builder approval
A construction loan asks for more upfront than a standard purchase loan, and that starts with the down payment. Because the lender is funding a home that does not exist yet, it wants the borrower to have real money in the project from day one. The exact amount depends on the lender, the program, and the borrower's overall profile — and it is one of the first things Douglas maps out when he prices a construction scenario across his wholesale lenders. Land the borrower already owns can often count toward that equity, which is one reason building on family land is such a common path.
Once the loan closes, the money comes out in draws tied to the build's progress. After each stage of work is finished and inspected — the foundation, the framing, the roof, the interior — the lender releases the next portion of the funds, usually to the builder. That inspection step protects both sides: the borrower never pays for work that has not been done, and the lender never funds more than the home is worth at that stage. The builder is part of this process from the start, too — the lender reviews the builder's experience and credentials, along with the plans, specifications, and budget, before approving the loan.
How construction-to-permanent financing works
With a construction-to-permanent loan, the whole process runs on one file. The borrower applies once, closes once, and pays one set of closing costs — and the permanent mortgage is set up at that same closing, so there is no second underwriting when the home is finished. During construction the borrower makes interest-only payments on the amount drawn so far, not on the full loan amount, which keeps the monthly payment manageable while the build is underway. The rate can be locked at closing or, depending on the program, locked later in the process — one of the details Douglas walks through before the file is priced, because the right choice depends on the timeline and the borrower's tolerance for rate movement.
When construction is finished, the loan converts to the permanent mortgage the borrower set up at closing — the same rate structure, the same loan terms, and no new application. The borrower simply begins making regular principal-and-interest payments on the completed home. That conversion is where the broker model pays off again: because construction programs, draw rules, and conversion terms vary by wholesale lender, Douglas prices the scenario across 200+ lenders rather than taking one bank's construction program as the only option. A lender overlay that would stop one file cold may not exist at another lender — and the borrower gets a personally priced answer, not an automated quote, from breaking ground to move-in day.
Construction loans in Northeast Florida
Northeast Florida is a construction-loan market in a way much of Florida is not. St. Johns County and the planned communities around Nocatee are among the fastest-growing areas in the state, and buyers there routinely choose a lot and a floor plan rather than settling for what a builder has already finished. A construction-to-permanent loan lets those buyers build on the lot they want, with the builder they chose, and close once on the finished home. Douglas's office sits in Jacksonville Beach, so these are the communities he prices every week, with the appraisers, builders, and closing teams who know them.
That local footing matters on a construction file, because the appraisal, the builder, and the borrower's full profile all get a harder look than on a standard purchase loan. A teardown on family land in Jacksonville Beach, a new home on a chosen lot in Nocatee, or a custom build in St. Johns County each raise questions a single bank's overlay might answer with a no — and with 200+ wholesale lenders to price across, Douglas can usually find the lender whose answer is yes. To talk through building a home in Northeast Florida, call Douglas Wilkerson directly at (904) 517-4049.
