ADU Loans – Build Income Right at Home

At Pacific Direct Mortgage we help make it possible for homeowners to unlock new business income opportunities by building an Accessory Dwelling Unit (ADU) on their primary residence property.

Our Owner Occupied ADU Loan Program is designed for borrowers who want to add a rental unit to their property. Whether you are planning to convert your garage, add a backyard unit, or build from the ground up, we want to help provide the financing needed quickly and without the excess red tape required by traditional banks and lenders.

Turn Your Backyard into Income

BBuilding an ADU is one of the smartest ways to create new business income while increasing long term property value. But traditional lending institutions and their underwriting often make the process complicated or slow, especially when construction or a primary residence is involved.

That is where we can help! Our private money ADU loans are flexible, equity based and built for homeowners who want to avoid the delays and stricter regulations of conventional financing.

We Say Yes When Others Say No

Our ADU loans are short-term, common-sense solutions that let you build now and refinance later once your unit is complete! 

Here’s what you can expect:

• Loans based on equity and property value, not strict income ratios.
• Fast approvals and funding so you can start construction or remodels quickly.
• No DTI restrictions since we underwrite based on the equity, not paperwork.
• Flexible terms designed to meet your timeline and exit strategy.

ADU Loan Program Highlights

Compliance Requirements for Owner Occupied ADU Loans

To ensure full compliance with state and lending regulations, the following are required for Owner Occupied ADU loans, in addition to any needed private money loan documentation:

1. Loan Purpose Letter – A handwritten, dated, and signed letter from the borrower that clearly states the purpose of the loan.
2. City Confirmation – Confirmation that the city allows the construction of an ADU at that property.
3. Plans and Permits – A copy of both. If permits have not yet been issued, if the loan is approved, our Lender could require a holdback of funds until they are approved.
4. Contractor Bid or Owner Builder Evidence – A copy of the contractor’s bid or documentation showing that the owner builder has experience or qualifications to complete the project.

ADU Loans Are Ideal For:

• Homeowners who want to generate rental income on their primary property.
• Borrowers who plan to convert, add, or build an ADU for business purposes.
• Owner builders or contractors who want to fund construction quickly.
• Homeowners who have equity available but do not qualify for traditional loans.

A Common Sense Lending Approach

At Pacific Direct Mortgage, we are considered a direct lender – as we have over 200 active private investors who are ready to fund loans!  We do not broker out your loan to other companies. This means faster decisions, flexible solutions, and a team that truly understands California real estate and ADU lending – all to better service you.

We evaluate each loan based on equity, property value, and project purpose, not rigid bank or traditional lending institution qualifications. With more than 30+ years of lending experience, we bring a family owned, common sense approach to every scenario!

Let’s Get Started

If you, a family member, a friend or even your client are ready to renovate or build an ADU, we are ready to help make it happen.

Call us today 707-708-0797 or fill out the form below to send in your ADU loan scenario. Our team will review it promptly and let you know how they can help you take the next step toward building income right in your own backyard or providing extra living space for your family or friends!