Question 1

How much down payment do I need for a construction loan in Oakland?

Accepted Answer

Construction lenders typically require 20% down minimum. On an $800,000 build, that's $160,000. Some lenders may go to 15% for strong borrowers, but 20% is the standard floor.

Question 2

What credit score do I need to qualify?

Accepted Answer

Most construction lenders require 700+ FICO. Some may consider 680–700 with strong income and reserves, but 700 is the practical threshold in California.

Question 3

How long does a construction loan take to close?

Accepted Answer

Plan on 45 to 60 days from application to closing. The timeline includes builder review, appraisal, and underwriting. Construction itself takes 12–18 months depending on the project scope.

Question 4

Do I need reserves to qualify?

Accepted Answer

Yes. Lenders require 6 to 12 months of mortgage payments in liquid reserves. On an $800,000 loan, that's roughly $40,000 to $80,000 set aside. Reserves prove you can cover the loan if construction delays occur.

Question 5

What happens when construction is done?

Accepted Answer

The construction loan converts to a permanent mortgage. You refinance into a standard 30-year fixed or ARM. The rate and terms depend on your credit and the home's final appraised value at that time.

Construction Loans in Oakland: Build Your Home in Alameda County