ADU Financing + FHA 203k in San Diego & Portland
Build an ADU, buy a property with one, or cash-out on your existing ADU. We count the rental income. FHA 203k available for construction.
Joe Pisa
Founder & Senior Loan Officer
NMLS #139369
"If Rocket, Chase, or your local credit union just crushed your dreams because of your credit score, self-employed income, or because you want to count your Airbnb income — you're in the right place."
Hey, ADUs are the hottest thing in California and Oregon right now. San Diego and Portland have some of the most ADU-friendly zoning in the country, and homeowners are adding $150k-$300k in value by building a backyard unit. The problem? Most lenders don't know how to underwrite ADU income, and they definitely don't know how to do FHA 203k renovation loans. We do both. We've been financing ADUs since before they were trendy, and we know exactly how to count that rental income to help you qualify.
Why We Close What Banks Deny
- FHA 203k loans to BUILD an ADU (one loan, one close)
- Cash-out refinance on properties WITH an ADU (we count the rent)
- DSCR loans for investment properties with ADUs
- We use actual ADU rental income or market rent estimates
- Loan amounts up to $3 million
- Close in 30-45 days for 203k, 21 days for cash-out
Recent Closings in San Diego & Portland
These are real deals we closed. Banks denied them. We didn't.
FHA 203k — built 800 sq ft ADU in backyard, now rents for $2,400/month
Cash-out refi — existing ADU generating $1,800/month, counted as income
Purchase with ADU — used ADU rent to offset mortgage, qualified easily
ADU Financing Questions for San Diego & Portland
Real questions we get daily — with straight answers
Can I use FHA 203k to build an ADU in San Diego?
Yes. FHA 203k allows you to finance the purchase price PLUS construction costs in one loan. You can build an ADU up to 1,200 sq ft in most San Diego zones.
Do you count ADU rental income for qualification?
Yes. If the ADU is already rented, we use actual income. If it's new, we use a market rent estimate from an appraiser. This can add $1,500-$3,000/month to your qualifying income.
What's the maximum loan amount for ADU financing in California?
FHA 203k goes up to the county limit ($1,149,825 in San Diego). For NON-QM/DSCR, we go up to $3 million.
Can I do a cash-out refinance if I already have an ADU?
Absolutely. If your property value increased because of the ADU, you can pull that equity out. We count the ADU rent as income to help you qualify.
What about Portland ADU regulations?
Portland allows ADUs on most residential lots. We've financed ADUs in all Portland neighborhoods — Sellwood, Alberta, St. Johns, you name it.
Can I convert my garage to an ADU and finance it?
Yes. Garage conversions are one of the most popular ADU types. FHA 203k can finance the conversion, and we can refi after it's done.
NorthStar Funding is a licensed mortgage broker. NMLS #139369. Equal Housing Lender. All loans subject to credit approval. Rates and terms subject to change without notice.