How to Finance an ADU Without Losing Your Low Mortgage Rate

An Accessory Dwelling Unit (ADU) can create rental income, provide housing for relatives, or add flexible living space to your property. But choosing the wrong financing structure is a dangerous mistake that could replace your historically low mortgage rate with a much higher one, or leave you carrying higher payments before construction is finished. In this video, Mortgage Strategist Cathy Sabater breaks down three ways homeowners can use their equity to finance an ADU: • Home Equity Line of Credit (HELOC) • Home Equity Loan (HELOAN) • Cash-Out Refinance You will learn how each option releases funds, how payments shift during construction, and the critical Fannie Mae guideline restricting the use of ADU rental income on cash-out refinances. 👇 *FREE RESOURCE:* Compare interest-rate structures, monthly payments, closing costs, and construction draw timing. Get my free *Home Equity Options Guide (with ADU Insert)* by commenting *EQUITY* below. 💬 *JOIN THE CONVERSATION:* Are you planning an ADU for rental income or family? Tell me in the comments! ⏱️ *CHAPTERS (Skip to the data you need):* 00:00 The Risk of Incorrect ADU Financing 00:37 How Much Equity Can You Access? 01:38 Option 1: Using a HELOC for Staged Expenses 02:41 Tradeoff 03:11 Option 2: The Home Equity Loan (HELOAN) 04:15 Option 3: Cash-Out Refinance Considerations 04:43 Must compare 05:14 Important Warning 05:24 Building the Complete ADU Budget 05:54 Fannie Mae ADU Rental Income Rules 07:04 Do not assume 07:16 Which Financing Option Fits Your Project? 08:13 How to Get the Free Home Equity Guide 📅 Book Your Strategy Call: https://scheduler.zoom.us/cathy-sabat... 💵 Free Home Equity Report: https://homequityreport.com/cathy5/ho... 📞 Cathy Sabater | Proud Veteran | Mortgage Strategist | 619-846-2675 🌎 Licensed in CA • TX • FL • NV • GA | nmls 373470 Company: Empire Home Loans | nmls #1839243. Equal Housing Opportunity Lender. Disclaimer: Educational content only. Not legal or financial advice. Loan guidelines and rates may change. #ADU #HomeEquity #MortgageStrategy #RealEstate #SanDiegoRealEstate