Did you know that we allow the option to use income from an accessory dwelling unit (ADU) for qualifying purposes?

Rental income from the ADU can be considered if the zoning allows for an accessory unit, whether it is current or grandfathered. This feature is available in our FHA and non-QM loan products such as the DSCR mortgage and others. However, there are certain conditions that must be met:

  • The appraisal report must confirm that the accessory dwelling unit is legal.
  • The appraiser needs to verify that the ADU is common in the area, with at least one comparable property also having an ADU.
  • Only one ADU is allowed per property.
  • The market rent for the accessory unit must be documented on FNMA Form 1007.
  • A copy of the current lease and two months of proof of rent receipt must be provided

The use of additional income on a single-family residence is crucial for qualifying for a mortgage loan. There have been many instances where you used rental income from the ADU and borrowers’ ratios were enough to qualify for the loan.

Contact us for more information about the use of rental income from an ADU unit.

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