An Accessory Dwelling Unit (ADU) is a versatile living space, which can include living areas over a garage, in a basement, or as a small addition to the main dwelling, offering homeowners a unique opportunity to maximize their property’s potential. However, navigating the complexities of financing a property with an ADU can be challenging, especially when meeting local zoning requirements and lender guidelines.
Did you know that even if an ADU is not entirely legal according to local zoning laws, it might still be eligible for financing? Our team of experienced professionals is well-versed in working with Fannie Mae and Freddie Mac, two of the largest mortgage financing entities in the United States. While Fannie Mae allows for an ADU on a property, Freddie Mac extends this allowance to properties with 1-3 units but not 4 units.
- Living area over a garage
- Living area in a basementÂ
- A small addition to the main dwelling
One of the key considerations when financing a property with an ADU is ensuring that the unit does not jeopardize any future insurance claims filed against the property. We work closely with lenders to assess the situation and determine the best action. Our goal is to ensure that the presence of an ADU does not hinder your ability to secure a loan or affect your property’s insurability.Â
Moreover, it’s important to note that the ADU must be smaller in size compared to the main dwelling. This requirement is crucial in maintaining the primary residence’s status and ensuring compliance with lender guidelines. Our team at MortgageDepot is adept at navigating these requirements, ensuring a smooth and efficient loan process for our clients.
We have the expertise and resources to work with Fannie Mae and Freddie Mac, ensuring your loan process is seamless and successful. Contact us for more information about financing properties with ADU’s.
