Generate Rental Income
California laws have made it easier than ever to build an ADU (Accessory Dwelling Unit) on your property. This can provide a separate space for aging parents or generate significant monthly rental income ($2,000+ per month in many areas).
We offer specialized Cash-Out Refinance and Renovation Loan products designed specifically for this purpose.
Renovation Loans
Borrow against the "Future Value" of your home after the ADU is built. Lenders will appraise the "As-Completed" value, allowing you to access more funds than a standard loan.
DSCR Loans
For buying new rentals: Qualify based on the cash flow of the property itself, not your personal tax returns. No income verification required for the borrower.
The ROI of an ADU
Cost to Build
- Construction Loan: $150,000
- Rate (approx): 7.5%
- New Monthly Payment: +$1,050/mo
Income Potential
- Estimated Rent: $2,200/mo
- Net Positive Cashflow: +$1,150/mo
- + Increased Property Value immediately upon completion
Common Questions
Can I use future rental income to qualify?
Yes, on certain loan products (like HomeStyle Renovation loans), we can use the estimated future rental income of the ADU to help you qualify for the higher loan amount needed for construction.
Is an ADU better than buying a condo?
Often yes. Building on land you already own eliminates the cost of buying land. Plus, managing a rental in your own backyard is significantly easier than driving across town, and there are no HOA fees eating into your profit.
How long does the process take?
Financing typically takes 30-45 days. However, permitting and construction for an ADU can take 6-12 months depending on your city. We recommend securing financing early in the process.
Discuss Your Project
Get expert advice on financing your ADU or rental.
Call Frank (800) 503-6648Or check rates for investment properties:
Check DSCR Rates