Financing Options for ADU Build

[Eddie Torres]

Hello, I'm taking on the task of having an ADU built on my lot within the next year, but as others might know, getting financing for these things can be a challenge if you don't have a ton of equity in your home or a large cash reserve. Here is the scenario:

1. I've already taken out $100k from the equity on my primary home, so that avenue has been exhausted.

2. I might be able to fund the remainder of the build with my own additional cash, but it would literally be all my reserves or close to it and that probably isn't a good way to live for obvious reasons.

3. I might be able to pull out some equity on my rental property but I'd rather not touch that and I'm not sure I'd even qualify due to almost being at my max DTI.

Does anyone know of any sources where I could get private funding? It's challenging because I'm looking to get financing for essentially a construction build so I know that might leave me with even less options since the collateral for many loans is actually the real estate that is in fact already built.

If anyone has any feedback, it would be much appreciated. Thanks.