Freddie Mac ADU Loan
Hi, Forum People
I am trying to finance an ADU on my property and am hitting a wall. However, I just discovered Freddie Mac has updated their qualifying criteria to include ADU rent. This is HUGE! Has anyone taken advantage of this loan to build an ADU? I would love to hear your story! I'm posting the link to the Freddie Mac updates here: https://sf.freddiemac.com/arti...
Amy,
Freddie Mac & Fannie Mae do not finance just an ADU standalone by itself. They will finance the home if it has a ADU on the property as a purchase or a refinance. An ADU is a detached living space like a mother in law suite. You can however take out a HELOC or do a cash out refinance on the property in which you would like to have it built. Another words you will need a line of credit or use one of your properties to take cash out through a refinance to get the cash needed for the build or for it to be moved onsite.
Hi Amy, the other option is to get a construction to perm loan. Get a couple quotes from GCs and then take the budget to a bank for approval.
I'm in the process of permitting a ADU, but doing a personal loan and running the management as an owner builder for less restrictions. I have a construction background so I'm familiar with the process.
You could also use a hard money loan with the plan to refinance out after the build.
Please update with which route you take and follow up if you have any construction related questions!
