WHAT’S A “NORMAL” LENGTH FOR CONSTRUCTION LOANS THESE DAYS?
Couldn’t agree more that 12 months is just not realistic for most custom builds. A few things I’ve noticed from my own projects and talking to neighbors:
- Permitting is a wild card. Like you said,
I’ve had one project where the city sat on our plans for almost five months because of a zoning hiccup. That’s before a shovel even hits dirt.“Permitting alone can eat up three months if you’re unlucky or dealing with a picky HOA.”
- Weather delays are another thing banks seem to ignore. Last winter, we lost nearly two months to rain and mud—no way to make that up without cutting corners, which isn’t happening on a high-end build.
- Subcontractor schedules are tighter than ever. Good trades are booked out, and if you miss your window, you’re waiting weeks or months. That’s not something you can always plan for, no matter how detailed your schedule looks on paper.
- Regional differences are huge. Friends in the Midwest have told me 18–24 month loans are standard there, but here in the Bay Area it’s like pulling teeth to get more than 12–15 months unless you really push.
One thing I’ll add: local credit unions and smaller banks sometimes have more flexibility than the big guys. On my last build, I got an extra six months just by working with a local lender who actually understood the area and construction process. The rate was a touch higher, but worth it for the breathing room.
I do think lenders are playing it safe because of market volatility, but it feels like they’re ignoring reality on the ground. If you’re building anything outside of cookie-cutter spec homes, those timelines just don’t add up.
Not sure there’s an easy fix except being ready to negotiate hard up front and having backup financing options in your back pocket... or just accepting that stress is part of the package these days.
WHAT’S A “NORMAL” LENGTH FOR CONSTRUCTION LOANS THESE DAYS?
I hear you on the 12-month timeline being out of touch, especially for custom homes or anything with a bit of architectural complexity. On a recent hillside project, we spent almost four months just wrangling with geotech reports and city feedback—by the time we got to foundation, we were already behind the original loan schedule. The lender didn’t seem to grasp that “site work” can mean months of excavation and shoring, not just a week or two.
Weather’s another one that’s easy to underestimate. Had a framing crew delayed by a surprise early winter, and suddenly we’re rescheduling every sub down the line. It’s like dominoes—one falls, the rest topple.
I’ve found that if you walk lenders through a detailed Gantt chart and highlight local permitting realities, some will budge on terms. Not always, but it helps. The smaller banks are definitely more open to real-world timelines, even if the rates aren’t as shiny.
Honestly, I wish more lenders would spend a day on site to see how unpredictable this stuff is. Until then, yeah... extra buffer in the contract and a Plan B for financing seem like the only way to stay sane.
WHAT’S A “NORMAL” LENGTH FOR CONSTRUCTION LOANS THESE DAYS?
Totally agree about the 12-month thing being unrealistic, especially if you’re not building a cookie-cutter house. We ran into similar delays—permits alone took us almost three months longer than expected, and that was before we even broke ground. One thing that helped was negotiating for an 18-month loan with a possible extension. Not every lender offers it, but it saved us a ton of stress. If you can, pad your timeline and budget for those curveballs... they always show up.
One thing that helped was negotiating for an 18-month loan with a possible extension. Not every lender offers it, but it saved us a ton of stress.
We tried for the 18-month option too, but our bank wouldn’t budge past 12 months unless we paid a higher rate. Ended up scrambling at the end to get an extension. If I had to do it again, I’d push harder or shop around more. Twelve months just isn’t realistic for custom builds anymore, especially with all the permit delays.
That’s been my experience too—12 months just isn’t cutting it these days, especially if you’re trying to do anything energy-efficient or custom. Have you noticed any lenders more willing to work with green builds? I’ve found some banks get nervous about non-standard materials or longer timelines. Curious if anyone’s had luck with credit unions or smaller local lenders being more flexible on loan terms?
