ADU Loans are always a type of mortgage - here's how they work

ADU is an acronym for "Accessory Dwelling Unit," meaning it's an accessory to the primary home. It's part of the property, so it's financed as part of the property, i.e. a loan on real estate or a mortgage. Construction and renovation loans are also types of mortgages - not separate from the property. What's unique about these loans is they are based on future appraised value ,i.e. after construction is completed. So if you don't have enough equity in the property to do a cash out refinance or HELOC, then we can do a renovation loan based on future value. If you want to build an ADU on someone else's property, there are ways to do that - but it's still a type of mortgage. Learn more about those options at #ADU #constructionloan #aduloan #renovationloans #renovationloan