Mortgage Lenders in Florida Construction & New Home Loans

Mortgage Lenders in Florida Construction & New Home Loans 
Everything Florida buyers, builders, and real estate professionals need to know about financing new construction
Florida's new construction market is booming. From the sprawling master-planned communities of Cape Coral and Port St. Lucie to the luxury coastal estates of Naples and Sarasota, the Sunshine State continues to attract homebuyers who want to build, not just buy. But financing a new home in Florida is fundamentally different from purchasing an existing property — and choosing the wrong mortgage lender could cost you tens of thousands of dollars or stall your dream project entirely.
This comprehensive guide explores everything you need to know about mortgage lenders in Florida who specialize in construction and new home loans. Whether you are a first-time buyer working with a production builder, an experienced homeowner commissioning a custom build, or a real estate professional looking to connect clients with the right lender, this guide delivers the answers you need in 2026.
Florida's median home list price was $425,000 as of September 2025, down slightly from the previous year — signaling a potential opportunity window for buyers and builders alike. With housing inventory tight in many markets and new construction permits rising across Southwest Florida, Tampa Bay, and Central Florida, understanding construction loan mechanics has never been more important.

1. Why Florida's New Construction Market Demands Specialized Lenders

Building a new home in Florida is not simply a matter of picking a floor plan and signing a contract. The state's unique combination of hurricane building codes, soil conditions, permitting requirements, and flood zone designations creates a complex financial environment that requires lenders who truly understand the local market.
Florida-specific construction financing challenges include:
- Hurricane-resistant construction standards: Florida's statewide building code (Florida Building Code, FBC) mandates wind-rated materials, impact windows, and reinforced roofing. These standards add to construction costs and affect appraisals.
- Flood zone requirements: Much of Florida's coastal and inland areas sit in FEMA-designated flood zones, requiring elevated foundations and flood insurance, both of which affect loan qualification.
- Permitting timelines: County-level permitting in markets like Collier, Lee, and Sarasota can take months, extending construction timelines and affecting your rate lock window.
- Rapidly changing material costs: Labor and material inflation in Florida has been particularly volatile, requiring lenders experienced in construction budget contingencies.
- Lot scarcity in prime markets: In established communities, buildable lots are scarce, often requiring specialized land-and-construction combo financing.
These factors make it essential to work with mortgage lenders in Florida who specialize in construction and new home loans — not general mortgage brokers who occasionally handle construction deals.

Florida New Home Construction by the Numbers (2026)

Metric
Data Point
Florida Median List Price (Sept 2025)
$425,000
Homes Sold Increase Year-Over-Year (Sept 2025)
+8%
Median Days on Market
82 days
Florida Homeownership Rate
67.3%
Florida Total Housing Units
10+ million
Typical Construction Loan Down Payment
20%–25%
Construction Loan Rate Premium Above Standard Mortgages
0.5%–1.0%
Typical Construction Period
6–18 months

2. Types of Construction & New Home Loans in Florida

Not all construction financing is created equal. Florida lenders offer several distinct loan products tailored to different borrower profiles and project types. Understanding each option is the first step toward choosing the right mortgage lender.

Construction-to-Permanent Loans (One-Time Close)

Construction-to-permanent loans — often called One-Time Close (OTC) or single-close loans — are the most popular option for Florida homebuyers building a custom home or working with a small local builder. These loans combine short-term construction financing and a long-term permanent mortgage into a single product.
Key features of construction-to-permanent loans in Florida:
- Single application and closing: You apply once and close once, saving you $3,000–$5,000 in duplicate closing costs.
- Rate lock at closing: Your permanent mortgage rate is locked when construction begins — protecting you from rate increases during the build phase, though you won't benefit if rates fall.
- Interest-only payments during construction: You only pay interest on the funds disbursed to your builder, not on the full loan amount.
- Automatic conversion: Once construction is complete and a Certificate of Occupancy (CO) is issued, the loan automatically converts to your permanent mortgage — no second application required.
- Typical construction period: Most Florida lenders allow 9 to 15 months for construction.
Best for: Owner-occupied custom home builds where you own or are purchasing land, and buyers who want simplicity and cost efficiency.

Stand-Alone Construction Loans (Two-Time Close)

Stand-alone construction loans — also called two-close or construction-only loans — cover only the building phase. When construction is complete, the borrower must obtain a separate permanent mortgage to pay off the construction loan.
Advantages of stand-alone construction loans:
- Rate flexibility: If rates drop during construction, you can shop for the best permanent mortgage rate after completion.
- Lender flexibility: You're not locked into one lender for both phases.
- Suitable for experienced builders: Those with significant reserves and flexibility often prefer this structure.
Disadvantages:
- Two closings, two sets of costs: Budget for $3,000–$5,000 for the construction loan closing and $8,000–$12,000 for the permanent mortgage closing.
- Rate risk: If rates rise significantly during construction, your permanent mortgage could be substantially more expensive than anticipated.
- Must requalify: You'll need to meet lender qualification standards a second time at the end of construction.

FHA Construction Loans (FHA 203(k))

FHA 203(k) loans allow borrowers to finance both the purchase of a home and renovation costs into a single mortgage. While not a ground-up construction product, 203(k) loans are valuable for buyers who want to purchase a distressed or older Florida property and renovate it significantly.
FHA 203(k) Feature
Details
Minimum Credit Score (Standard)
580 (with 3.5% down)
Minimum Credit Score (Limited)
500 (with 10% down)
Most Lenders Prefer
620–640+
Down Payment Requirement
3.5%–10%
Loan Limit (2026, most FL counties)
$498,257
Max Renovation Amount (Limited)
$35,000
Best For
Purchase + renovation of existing homes

VA Construction Loans

Eligible veterans and active-duty service members may access VA construction loans — a powerful benefit that allows qualified borrowers to build a new primary residence with no down payment. However, VA construction loans are less common than standard VA purchase loans, and only a limited number of Florida lenders offer them.
VA construction loan requirements in Florida:
- The builder must be VA-approved
- The property must meet VA Minimum Property Requirements (MPRs)
- A VA appraisal must be completed before closing
- Most lenders offer VA construction loans only as construction-to-permanent products
- No private mortgage insurance (PMI) required

USDA Construction Loans

USDA construction loans are available for buyers building in eligible rural areas of Florida — which includes portions of North Florida, the Panhandle, and rural Central Florida counties. These loans require zero down payment for qualifying borrowers and are administered through USDA's Single Family Housing Guaranteed Loan Program.
Important: USDA eligibility is based on geographic area and household income limits. Borrowers should verify their property's USDA eligibility status before pursuing this loan type.

Production Builder Financing (In-House Lenders)

Florida's major production builders — Lennar, KB Home, D.R. Horton, Pulte, Taylor Morrison, and GL Homes — operate affiliated mortgage companies that offer in-house financing to buyers of their communities. These programs often include incentives like:
- Closing cost credits: Builders may cover some or all closing costs when you use their preferred lender.
- Rate buy-downs: Temporary or permanent rate buy-downs can save thousands over the life of your loan.
- Free upgrades: Some programs bundle design upgrades — countertops, flooring, appliances — into the financing incentive.
The smart move: Always get quotes from both the builder's lender and at least two independent lenders before deciding. Calculate the total cost of each option including rate, points, and incentive value. Sometimes the builder incentive makes their financing worthwhile even at a slightly higher rate; other times, you'll save far more with an independent lender.

3. How Construction Loans Work in Florida — Step by Step

Understanding the mechanics of a Florida construction loan will help you move confidently through the process and avoid costly surprises.

The Draw Schedule

Unlike a traditional mortgage that disburses a lump sum at closing, a construction loan releases funds in stages called draws. Each draw corresponds to a completed milestone in the construction process, verified by a bank inspection before funds are released.
Typical Florida construction loan draw schedule:
- Lot/land purchase and site preparation (foundation excavation)
- Foundation completion and slab pour
- Framing completion (walls and roof structure)
- Roof and exterior sheathing, windows, and exterior doors
- Rough-in mechanical systems (plumbing, HVAC, electrical)
- Insulation, drywall, and interior framing completion
- Interior finishes (flooring, cabinets, fixtures)
- Final inspection, Certificate of Occupancy, and conversion to permanent mortgage

Interest-Only Payments During Construction

During the construction phase, you make interest-only payments on the funds actually disbursed — not on the full loan amount. For example, if your total loan is $600,000 but only $150,000 has been disbursed to the builder after the foundation draw, you pay interest only on the $150,000.
This significantly reduces your monthly carrying costs while construction is underway, particularly if you are also paying rent on a current residence.
Payment Stage
Estimated Amount
Total Construction Loan
$600,000
Amount Disbursed After Foundation
$150,000
Monthly Interest (7.5% rate)
~$938/month
Monthly Interest at Full Disbursement
~$3,750/month
Permanent Mortgage Payment (30yr, 6.75%)
~$3,892/month
Estimated Closing Costs (One-Time Close)
$15,000–$22,000

Rate Lock and Conversion

When your construction-to-permanent loan closes, your permanent mortgage rate is locked. This rate stays with you through the construction period and into your permanent mortgage — for better or worse.
Rate lock considerations for Florida construction borrowers:
- Extended locks are available: Many Florida construction lenders offer 12 to 15-month rate locks — longer than the standard 30 to 60-day lock on a conventional purchase mortgage.
- Rate lock premiums: Longer rate locks typically cost slightly more (typically 0.125% to 0.25% of the loan amount).
- Float-down options: Some lenders offer float-down provisions that let you take advantage of a lower rate if rates fall before conversion, typically for a fee.

4. Qualifying for a Construction Loan in Florida — Full Requirements

Construction loans in Florida have stricter qualification standards than traditional purchase mortgages. You are borrowing against a property that does not yet exist, which makes these loans inherently riskier for lenders.

Credit Score Requirements

Loan Type
Minimum Credit Score
Construction-to-Permanent Loans
Minimum 680 (700+ preferred)
Stand-Alone Construction-Only Loans
Minimum 680–700
FHA 203(k) Loans
Minimum 580 (500 with 10% down)
VA Construction Loans
No official minimum (lenders set 620–660)
USDA Construction Loans
Minimum 640 (most lenders)
Jumbo Construction Loans ($766,550+)
Minimum 720–740
Pro tip: Even if you meet the minimum credit score, a score of 740 or above will unlock the best available rates and terms. For every 20-point bracket improvement in your score, you can often improve your interest rate by 0.125% to 0.25%.

Down Payment Requirements

- Standard construction loans: 20%–25% of total project cost (land + construction)
- Strong-credit borrowers: Some lenders allow 15% down for borrowers with 740+ credit and significant reserves
- FHA 203(k): As low as 3.5% down (580+ credit score)
- VA construction: 0% down for eligible veterans
- USDA construction: 0% down in eligible rural Florida areas
- Space Coast Credit Union: Accepts as little as 10% down on construction-to-permanent loans for qualified members
Important note: Down payment is calculated on total project cost — not just the construction cost. If you paid $80,000 for a lot and your construction cost is $520,000, your total project cost is $600,000. A 20% down payment means $120,000 out of pocket.

Debt-to-Income Ratio (DTI)

- Maximum DTI for most construction lenders: 43%
- FHA: Up to 50% in some cases with compensating factors
- Calculation note: During construction, DTI is calculated based on the projected permanent mortgage payment — not the current interest-only payment

Cash Reserves

Florida construction lenders typically require demonstrated cash reserves of:
- 2–6 months of projected mortgage payments (liquid assets)
- A contingency reserve of 5%–10% of construction budget for overruns
- Funds to cover any gap between draws (in case construction outpaces disbursements)

Contractor Requirements

Every Florida construction lender requires a licensed, insured contractor. Most lenders will not work with unlicensed builders, owner-builders, or contractors with unresolved complaints. You will need:
- Proof of Florida general contractor license (CGC or CBC license)
- Current general liability and workers' compensation insurance
- Completed builder questionnaire or financial statement
- Signed construction contract with detailed scope of work and timeline
- Contractor's resume or project history demonstrating comparable builds

Documentation Checklist

Gather these documents before applying to Florida construction lenders:
- Personal financial documents: Two years of W-2s, federal tax returns, 30 days of pay stubs, two months of bank statements, investment and retirement account statements
- Self-employed borrowers: Two years of business and personal tax returns, year-to-date profit and loss statement, business bank statements
- Construction project documents: Signed construction contract, detailed construction budget, architectural plans and specifications, builder's license and insurance certificates, building permits (if issued), property survey and legal description
- Land/lot documents: Purchase contract or deed if you already own the land, title search, survey, zoning verification

5. Construction Loan Rates in Florida — What to Expect in 2026

Florida construction loan interest rates are typically 0.5% to 1.0% higher than standard 30-year fixed mortgage rates due to the elevated risk associated with construction lending. In 2026, with conventional 30-year fixed rates hovering in the mid-to-high 6% range, most Florida borrowers can expect:
Loan Type
Approximate 2026 Rate Range
Conventional 30-Year Fixed (Purchase)
~6.50%–7.00%
Construction-to-Permanent Loans
~7.00%–7.75%
Stand-Alone Construction Loans (Variable)
Prime Rate + 1%–2%
FHA Construction Loans
~6.75%–7.25%
VA Construction Loans
~6.25%–6.75%
Jumbo Construction Loans ($766,550+)
~7.25%–8.00%
USDA Construction Loans
~6.75%–7.25%
Rates are approximations only and vary by lender, credit score, LTV ratio, loan amount, lock period, and market conditions. Always request a written Loan Estimate from multiple lenders before making a decision.

Factors That Affect Your Construction Loan Rate

- Credit score: The single biggest individual factor. A 760 vs. a 680 score can mean 0.50%+ in rate difference.
- Loan-to-value (LTV): Lower LTV ratios (more equity/larger down payment) command better rates.
- Loan amount: Jumbo loan amounts above conforming limits face higher rates due to additional lender risk.
- Rate lock period: A 15-month lock costs more than a 6-month lock.
- Loan type: VA and FHA programs often offer below-market rates for eligible borrowers.
- Lender type: Credit unions and community banks in Florida often offer more competitive construction rates than large national banks.

6. Top Mortgage Lenders in Florida for Construction & New Home Loans

Florida borrowers have access to a wide range of lenders for construction financing. Below is a breakdown by lender type to help you identify the best fit for your project.

Florida Credit Unions & Community Banks

Florida's credit unions and community banks are often the best-kept secret in construction lending. They frequently offer more competitive rates, more flexible underwriting, and more personalized service than large national banks.
Lender
Key Features
Florida Credit Union (FCU)
Construction-to-permanent loans, land financing, one-time close. Statewide.
Space Coast Credit Union (SCCU)
As low as 10% down on construction-to-perm. Brevard County and beyond.
Community Credit Union of Florida (CCU)
Construction-to-permanent for conventional and jumbo. Brevard County.
Suncoast Credit Union
Competitive construction loan programs across Florida's Gulf Coast markets.
Achieva Credit Union
Construction financing in Tampa Bay, Pinellas, and Pasco counties.

Regional & National Banks Active in Florida Construction Lending

Lender
Florida Presence & Highlights
Amerant Bank
Detailed construction guides; strong presence in South Florida markets.
TD Bank
Construction-to-permanent programs in Florida with competitive rates.
Regions Bank
Active in North and Central Florida markets with construction loan products.
Wells Fargo
Construction-to-permanent loans for qualified borrowers; wide branch network.
Bank of America
New construction and renovation loan programs with digital application.

Specialty Construction Mortgage Companies

Lender
Specialization
Fidelity Home Group
Specializes exclusively in new construction loans: FHA, VA, conforming, jumbo across FL.
Pathway Mortgage (Sarasota)
One-time close construction loans; builder line of credit programs; same-day draws; $0 down options available.
Reach Home Loans
Boutique construction lender with deep Florida expertise and 2026-specific guidance. https://agentsgather.com/mortgage-lenders-in-florida-construction-new-home-loans/