A construction to perm loan is one loan that takes you through the construction process and then turns into your mortgage.
You close only one time, and you lock in your interest rate. You only pay interest on the amount of the loan used during the construction process.
The COO is the certificate of occupancy. Once you get this certificate, your construction loan will turn into your mortgage, making it very easy and eliminating you from having to attend another closing.
So to sum it up:
1. Find your Land
2. Create your home plans
3. Get your financing in order
4. Build your home
5. Your loan turns into your mortgage