Finance Your ADU The Smart Way
Explore financing options, grants, and incentives to make your ADU project affordable and maximize your return on investment.
Popular Financing Options
Choose the financing solution that best fits your financial situation and project goals.
Cash-Out Refinance
Refinance your existing mortgage for more than you owe and use the cash for ADU construction.
Pros:
- Access large amounts of capital
- Potentially lower interest rates
- Tax-deductible interest
- No separate loan payments
Considerations:
- Resets your mortgage term
- Closing costs and fees
- Risk losing home if unable to pay
- Requires sufficient home equity
Best For:
Homeowners with significant equity and favorable refinance rates
Home Equity Line of Credit (HELOC)
Revolving credit line secured by your home's equity, draw funds as needed during construction.
Pros:
- Pay interest only on funds used
- Flexible draw schedule
- Lower initial costs
- Reusable credit line
Considerations:
- Variable interest rates
- Risk of rate increases
- Home serves as collateral
- Credit line may be frozen
Best For:
Homeowners who want flexibility and have stable income
All Financing Options
Compare all available financing methods to find the perfect fit for your ADU project.
Cash-Out Refinance
Refinance your existing mortgage for more than you owe and use the cash for ADU construction.
Best For:
Homeowners with significant equity and favorable refinance rates
Home Equity Line of Credit (HELOC)
Revolving credit line secured by your home's equity, draw funds as needed during construction.
Best For:
Homeowners who want flexibility and have stable income
Financing Process
Follow these steps to secure the best financing for your ADU project.
Assess Your Financial Situation
Review your credit score, income, debt-to-income ratio, and available equity.
Determine Your Budget
Calculate total project costs including construction, permits, and contingencies.
Compare Financing Options
Evaluate different loan types based on your situation and project needs.
Get Pre-Approved
Obtain pre-approval letters to strengthen your position with contractors.
Finalize Financing
Complete the loan application process and secure funding before construction begins.
Calculate Your ADU Investment Return
Use our ROI calculator to see how quickly your ADU will pay for itself with rental income.
Need Help Choosing the Right Financing?
Our financing experts can help you navigate your options and find the best solution for your situation.