Tips to fund your project

Building an Accessory Apartment can cost more than other home improvements like a deck or a kitchen remodel. AddUP's free tools make it easy to put together a funding plan that fits your goals.

Explore your options


Most homeowners tap into their savings for at least some of the cost of construction. To decide what assets you are comfortable using, it helps to know how quickly you may be able to replenish them.

Your free Feasibility Report includes estimates of typical ADU construction costs and average rents in your area. These provide a starting point to determine how quickly your project could pay for itself.

Home loans

A Home Equity Line of Credit (HELOC) or mortgage refinance (refi) lets you borrow based on your equity — the difference between your home's value and what you owe. There are minimum equity, credit, and income qualifications.

If you don't have enough equity, a Renovation Loan can allow you to borrow based on your home's future value after your ADU is added. For older homeowners who do have enough equity, reverse mortgages may also be an option.

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Loans from family and friends

Family-and-friend loans are a popular source of ADU financing, providing low interest rates and flexible terms. Our                            can help you explain to loved ones what you are building and why they should lend their support.

Short-term financing

Some homeowners use higher-interest financing with the intent of paying it off after construction when the rental income and added property value from their ADU may make it easier to qualify for a home loan. Sources include:

  • Construction loans

  • Personal loans

  • Some 401(k) and life insurance plans allow borrowing

  • Credit cards (typically just used to supplement)

Compare and plan

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Compare your options side-by-side

As you identify funding sources to consider, save their details to your free Funding Board. Compare available loans based on their interest rates, costs, and repayment terms.

See that your project works financially

Use the cost and rent income estimates from your Feasibility Report to decide how much funding you need to obtain and how much you can spend each month on loan payments.

Your Funding Board tracks the total funds you have available, the total monthly repayments for any loans you plan to use, and the overall cost of funding your project.

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