Question 1

Can I build on agricultural land in Merced County?

Accepted Answer

Not with a standard construction loan. Lenders require residentially zoned land. Check zoning with Merced County before you go under contract.

Question 2

How does a one-time-close construction loan work?

Accepted Answer

You close once and your loan automatically converts to a permanent mortgage when the build finishes. It saves closing costs and locks your rate early.

Question 3

What credit score do I need for a construction loan?

Accepted Answer

Most lenders want 680 or higher. A score below that narrows your options significantly and may push you toward hard money.

Question 4

Do lenders check my builder's license?

Accepted Answer

Yes — every time. Lenders verify your contractor's license and track record before approving the loan. Vet your builder early.

Question 5

How are construction loan funds distributed?

Accepted Answer

Lenders release funds in draws tied to construction milestones. An inspector verifies each phase before the next draw is released.

Question 6

Can I use a construction loan for major renovations?

Accepted Answer

Yes, if the scope is large enough. Lenders treat gut rehabs similarly to new builds. Minor remodels don't qualify — those use different loan products.

Construction Loans in Livingston, CA