Question 1

How long does construction loan approval take in San Pablo?

Accepted Answer

Expect 30-45 days from application to approval. The process requires detailed plan review, contractor vetting, and appraisal of the proposed finished value. Starting early prevents construction delays.

Question 2

Can I act as my own general contractor with a construction loan?

Accepted Answer

Some lenders allow owner-builders, but most require licensed general contractors. Owner-builder loans typically need larger down payments and extensive construction experience documentation.

Question 3

What happens if construction costs exceed the loan amount?

Accepted Answer

You must cover overages with personal funds before the lender releases additional draws. This is why 10-20% contingency reserves are essential when budgeting construction projects.

Question 4

How do construction loan draws work during building?

Accepted Answer

Lenders release funds in stages as work completes, typically 4-6 draws. An inspector verifies each construction phase before releasing the next payment to your contractor.

Question 5

What rate should I expect when converting to permanent financing?

Accepted Answer

Rates vary by borrower profile and market conditions at conversion time. Construction-to-permanent loans lock your permanent rate at initial closing, protecting against rate increases during building.

Construction Loans in San Pablo: Build Your Vision in Contra Costa County