What Is a Construction Loan?

Building a home in San Diego is an exciting venture, but its funding requires the right loan—and the right lender. At LBC Mortgage, we’ve made it our business to make the construction loan process simple and hassle-free for homeowners and investors. Our experience, competitive rates, and personalized service have made us California’s mortgage broker of choice for construction loans.

A construction loan is a short-term loan that is used to fund the construction or renovation of a house. Unlike standard mortgages, these loans disburse funds in phases, or “draws,” as the work is being done.

How Hard Money Construction Loans Work

Construction loans are arranged to fund every facet of construction, including land purchase, materials, and labor. You typically make interest-only payments during the construction period. Upon completion of the project, the loan can be refinanced into a permanent mortgage or paid off in full.

At LBC Mortgage, we offer construction loan products with the flexibility to accommodate your budget, your timeline, and your goals. We help you choose the structure that works best for your project—whether that’s a single-close or two-close loan.

Why Choose a Construction Loan in San Diego?

San Diego features an competitive, opportunity-rich real estate market. Whether you’re constructing a custom house in La Jolla or starting a multi-unit project in North Park, a construction loan provides the freedom to build your dream property.

Benefits of Building in San Diego

San Diego has good home values, a strong rental market, and pleasant weather all year round. New construction is generally a good investment with low inventory and high demand. A hard money construction loan provides an advantage in this competitive real estate market.

LBC Mortgage understands the unique character of San Diego neighborhoods. We guide you through local zoning, permits, and valuation methods to maximize your investment.

Construction Loan Types We Offer

Every project is different. That’s why we offer a variety of construction loan products to fit your requirements.

Construction-to-Permanent Loans

This product converts your loan to a regular mortgage once the home is constructed. You only close once, which saves time and reduces costs. We help you lock in a low rate and make the process simple from start to finish.

Stand-Alone Construction Loans

If you do not need to make a long-term financing commitment or would like to shop rates down the road, this option allows flexibility. Post-construction, we help you roll over into the best long-term mortgage for your situation.

Owner-Builder Loans

If you are building yourself, we can provide financing for experienced builders. We will review your plans, budgets, and permits to verify everything is in order for approval.

Construction Loan Requirements

Construction loans are underwritten differently than traditional mortgages. Do not worry, however—our team walks you through each step and makes your application shine.

You will need to qualify with detailed construction plans, a qualified contractor or builder, and a realistic budget. We will also look at your credit, income, and down payment. Most San Diego hard money construction loans require a 30% down payment, but we try to explore all options to reduce your upfront costs.

LBC Mortgage offers pre-approval so you know exactly what you can afford before breaking ground. We also coordinate with your builder to set up a draw schedule to keep your project funded and on track.

The LBC Mortgage Advantage

We’re not just mortgage experts—we’re your construction partners. Here’s why more clients use us for their San Diego construction loans.

Local Expertise

We know the San Diego market inside and out. From the engineering requirements of hillside construction to coastal zoning, we have money- and time-saving knowledge.

Personal Service

Every building project has its own character. We provide one-on-one service from application to final inspection. We’re available when you need us and committed to fast, clear communication.

Competitive Pricing

Thanks to our network of top lenders, we’re able to secure rates that others can’t. First-time builder or seasoned developer, we’ll customize your loan to fit your financial goals.

Fast Approvals

Construction timelines can’t wait. Neither do we. We prioritize speed without sacrificing quality. Our streamlined process gets you building faster—and finishing with less delay.

Common Challenges—and How We Solve Them

Construction loans can be complex. But the right broker converts complexities into strengths. At LBC Mortgage, we anticipate obstacles before they arise and keep you on track.

Permitting Delays

Local permits don’t always move quickly. We help you plan your timeline accordingly and offer financing flexibility in the event delays do occur.

Budget Overruns

Construction costs can vary. We help you build contingency into your loan and actively manage draw disbursements to reduce surprises.

Contractor Requirements

Not all lenders approve all contractors. We help you select a competent contractor and verify they qualify for lender prerequisites to avoid approval delays.

Is a Construction Loan Right for You?

If you’re ready to build your own home or tackle a major renovation, a construction loan can be your best choice. Construction loans offer flexibility and control you simply won’t find with standard mortgages. And with the right mortgage broker in your corner, everything goes smoothly and stress-free.

At LBC Mortgage, we take pride in helping clients make their vision a reality—brick by brick. Whether you’re building your dream home or embarking on a new investment project, we’re here to help you finance it with confidence.

Start Your Construction Loan Process Today

Building a home is a massive undertaking—but with the right people on your side, it’s also one of the most rewarding experiences you’ll ever have. At LBC Mortgage, we don’t just simplify San Diego construction loans, we make them affordable and tailored to your needs.

Call us today to get started with a free consultation. Let’s build your tomorrow together.