Five loans, released funds, and an ADU that never started
A San Diego County case highlights the gap between financing approval and construction progress.
CSLB report: June 2025
Financing moved ahead of the work
In its June 2025 board packet, CSLB described an owner who contracted for a two-story detached ADU for $475,582.73. The contractor persuaded the owner to apply for five loans.
The report says $350,000 in loan funds was released to the contractor without the owner knowing that all those funds had been released. The project never started.
What CSLB reported
CSLB described multiple ADU complaints in the investigation and reported a license revocation effective June 16, 2025. Its report said a referral for criminal charges was in progress. That is not a reported criminal conviction.
The published account does not establish that this homeowner later recovered the released funds or completed the ADU.
Know who controls each release
Before signing financing documents, ask the lender to explain exactly when money leaves the loan account, who receives it, and what evidence supports each release. Ask whether your approval is required and how you can see a complete disbursement history.
Keep the loan balance, payments to the contractor, and value of completed construction as three separate records. Financing being approved does not mean work has been completed.
If the disbursement record does not match your understanding, contact the lender directly before authorizing more payments. A contractor’s explanation should not be your only source for what happened inside a financing account.
