Question 1

How does a construction loan work in Aliso Viejo?

Accepted Answer

You draw funds in stages as construction hits set milestones. The loan converts to a permanent mortgage when the build is complete.

Question 2

Do I pay interest during construction?

Accepted Answer

Yes, but only on funds drawn, not the full loan amount. Payments stay lower during the build phase.

Question 3

Can I use a construction loan to renovate an existing home?

Accepted Answer

Yes. Major renovation projects can qualify. The scope must be significant enough to justify the loan structure.

Question 4

Does my builder need lender approval?

Accepted Answer

Yes. Most lenders require the builder to be licensed, insured, and pre-approved. Have your contractor's credentials ready early.

Question 5

What's the difference between one-time and two-time close?

Accepted Answer

One-time close combines construction and permanent financing into one loan. Two-time close requires a second closing after completion.

Question 6

How long does a construction loan term last?

Accepted Answer

Typical construction phases run 9 to 12 months. Extensions may be available but often come with added fees.

Construction Loans in Aliso Viejo, CA