How To Finance An ADU When You Don't Have Home Equity

[@brandon-built]

Save 20-45% on Building an ADU with Realm: f.realmhome.com/?

[@WillJohnsonSD_Inspector]

Renovation loans have many overlays that set some limitations. 203K only allows attached ADUs, while FM Homestyle allows detached. I am not aware of new construction loans that can be used for an ADU addition. Talk to a construction financing specialist.

[@brandon-built]

Indeed, talking to a construction financing specialist is always the best first step to figure out your available options.

[@youtubecarspottersguide1]

problem. is the general contractors. first thing they ask is what your budget ? so how can you figure out the price ?

[@brandon-built]

Get pre-approved first to learn your general budget. Don't necessarily tell the contractors what your max budget is so that you leave room for contingencies. Then talk to as many builders as possible to find someone who can build what you want at a price you can afford. Signing a fixed price contract with your builder helps a lot in keeping the cost predictable and is oftentimes required by the lender.

[@youtubecarspottersguide1]

@@brandon-built is $200 sf a good general budget ? for 500sf ?

[@brandon-built]

@@youtubecarspottersguide1 depends on where you live. That would be a good deal in LA or the Bay Area. That would not be a good deal in Virginia.

[@rahulmenon3565]

Very helpful video, thanks a lot!

[@brandon-built]

You're very welcome!

[@Khanh.Nguyen369]

Great info. Thank you.

[@brandon-built]

You're welcome!

[@DB-ev5ep]

How does this work with the new laws in CA that allows a buyer to purchase an ADU? Will someone be able to get a new construction loan for an ADU under these new laws?

[@brandon-built]

Thanks for watching! Which new law are you referring to?

[@e.venturam]

How is the design process for an ADU?

[@brandon-built]

The process is quite similar to designing a full size house, but you'll have to design within more constraints such as size. FInd an architect or design-build firm, get plans stampled by an engineer, submit for permit approval with local building department.