Question for Lenders - ADU Financing - CA - LA - 4 unit SB9

[Alan Asriants]

My partner is a builder in the LA area and his client posed an interesting question for him that could affect financing in the future. 

He owns a 4 unit property in LA and wants to convert the 2 car garage into an ADU. With the addition of the ADU would the property be now a 5 unit property or a 4 unit with an ADU?

The concern here is the financing. Will he and potential buyer of the property be subject to Commercial financing or will the property still qualify for residential 4 unit and under loan types/primary?

From my understanding a single family with an ADU still classifies as a single family, NOT a duplex.

Another question would be, if he subdivided the land using SB-9 and built a duplex or another single family on the new lot, is financing, cash out refi, etc the same as if you built on an empty lot?

Thank you!