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Malibu's restrictive zoning and coastal commission requirements make construction financing different from anywhere else. Most lenders won't touch projects here without deep experience in California Coastal Zone compliance.
Custom builds in Malibu typically run $800-$1,500 per square foot before land costs. Your construction loan needs to cover extended timelines caused by permitting delays and specialized coastal construction requirements.
Construction Loans in Malibu
Construction lenders want 680+ credit and 20-25% down on the total project cost including land. If you already own the lot, that equity counts toward your down payment requirement.
You need detailed plans stamped by a licensed architect and a fixed-price contract from a builder with coastal construction experience. Budget contingencies of 15-20% matter here because change orders are guaranteed in Malibu builds.
Local decision guide
Use this guide to connect construction loans eligibility, lender expectations, and local market factors before comparing payment options in Malibu.
Malibu's restrictive zoning and coastal commission requirements make construction financing different from anywhere else. Most lenders won't touch projects here without deep experience in California Coastal Zone compliance.
Custom builds in Malibu typically run $800-$1,500 per square foot before land costs. Your construction loan needs to cover extended timelines caused by permitting delays and specialized coastal construction requirements.
Construction lenders want 680+ credit and 20-25% down on the total project cost including land. If you already own the lot, that equity counts toward your down payment requirement.
Only a handful of our 200+ lenders will finance Malibu construction, and they price for the risk. Expect rates 1-2% above conventional mortgages plus 1-2 points in origination fees.
Regional banks with California coastal experience offer better terms than national construction lenders. They understand why a 24-month build timeline in Malibu isn't a red flag — it's normal.
Three deals kill themselves before they start: underestimating soft costs, using contractors without coastal permits history, and assuming 12-month completion timelines. Plan for 18-24 months minimum.
The conversion to permanent financing matters as much as the construction loan itself. Lock in your end-loan terms upfront through a construction-to-permanent product rather than hoping rates stay favorable.
Bridge loans work for major renovations if you're keeping the foundation and 50%+ of existing walls. Full teardown rebuilds require construction financing regardless of existing structure value.
Jumbo construction loans handle projects over conforming limits, which is most Malibu builds. Hard money only makes sense for land acquisition while you secure construction financing — rates are too high for 18-month construction periods.
Lenders scrutinize fire insurance availability before funding any Malibu construction loan. Post-Woolsey Fire, expect higher premiums and possible FAIR Plan requirements that affect your debt-to-income ratio.
Septic system approvals and water availability documentation delay more Malibu projects than any other factor. Your lender requires proof of these before releasing first-draw funds, not at project completion.
Typically 75-80% of completed appraised value. If you own the land free and clear, that equity reduces how much cash you need at closing.
Yes, you pay interest monthly only on funds actually drawn. Full principal and interest payments start when the loan converts to permanent financing.
Most lenders allow 12-18 month extensions for legitimate delays like permit issues. Extension fees typically run 0.25-0.50% of the loan amount.
Few construction lenders allow owner-builders in Malibu. The coastal compliance complexity requires licensed contractors with proven track records.
Lenders require third-party inspections before releasing funds for each construction phase. Budget $500-$800 per inspection and 5-10 business days processing time.