Mortgage Options-Duplex with ADU (Detached Garage Apt)-Charlotte

[Matthew Jones]

Hi All,

I have an awesome 3 family property in Charlotte, NC under contract, but I am now having issues locking down financing, which previously didnt seem to be a problem until some rules interpretations.

The property is a Duplex with a big detached 3 car garage that has an apartment above it. Throughout the whole process, I considered this a triplex or 3 unit property, not knowing that semantics really mattered in the way you describe it the property. I just assumed than when certain lenders would loan money on "2-4 unit properties", the way the units are structured shouldnt matter.

We have been working on an FHA loan for financing, and all was good until the appraiser called the Property a "Duplex with an ADU." Apparently, the FHA will loan on 2-4 unit properties that are all attached, or also loan on a SFR that has an ADU, but not a Duplex with an ADU, which makes no sense at all but it is what it is.

And now my broker is telling me that he is finding no available mortgages for a multi-family property with an ADU, not even conventional mortgages.

I admit that this is a pretty strange property layout (Duplex with detached garage/apartment) but I see no reason why I should be able to finance this baby!

This is blowing my mind, and im not ready to give up fighting for this property and this deal.

Does anyone have any experience with this, or any ideas of ways to be creative and find a mortgage to close the deal?

Obviously, I know I could possibly use a hard money lender or cash, but I would prefer to use traditional lending if possible.

Any help is greatly appreciated!