Financing a Tiny Home or ADU With a Tiny Home Loan
From Tiny House Dreams to Big Reality!
In a region where space comes at a premium, the allure of tiny living in California has never been stronger. Whether you’re drawn to a minimalist lifestyle, environmental sustainability, or the idea of owning a home without a huge mortgage payment, financing your tiny home can seem like a daunting task. Many aspiring tiny homeowners worry that they won’t qualify for a tiny home loan or that their project isn’t financeable. However, there are more options for tiny home loans and ADUs than you might think and we’re here to share those resources with you!
Financing an ADU
ADUs, also known as Accessory Dwelling Units, are an increasingly popular type of structure for backyard studios, granny flats, and offices. Meredith Munger at Cross Country Mortgage and ADUloans.net is an expert on ADU financing and can provide you with several options to consider. She is a leader in ADU loans and keeps us updated on changes within the financial world that apply to ADU and tiny home loans. For example, in December of 2023, Fannie Mae, Freddie Mac, and FHA made changes to their policies that allow more people to qualify for ADU loans. In addition, some ADU builders like StudioShed facilitate a relationship between their customers and lenders who are experienced in financing ADUs.
Tiny Home Builder Financing
Some tiny home builders and manufacturers have established relationships with lenders for financing and can be incredibly helpful as you seek financing for your tiny home. Or, they can likely recommend financial institutions that have provided tiny home financing for their previous customers. For example, Tumbleweed Tiny Homes has built a network of lenders to provide tiny home financing options for their customers in every state.
RV Loans
Utilize this recommendation at your discretion. RV Loans are typically not approved if customers are using the RV as a primary residence. Therefore, if you’d like to finance your RV and use it as a tiny home full-time, you would need to secure financing while you have a traditional full-time residence. In this situation, you would finance the RV as a recreational vehicle for use camping on the weekends and then once you sell your home or move out of your apartment, you would have already secured the loan on your RV.
Financing for Land
If your tiny living dreams include a small plot of land to call your own, landishome.com offers easy financing options for raw land. Founders Hannie and Cory Inmann, a mother-and-son duo, believe that landownership is empowering and that the opportunity to own land should be accessible to everyone. As local San Diegans, they have experienced the feeling of land being finite and have many options available for aspiring land owners. They show land listings directly on their website, including a whole category dedicated to ‘No-Zoning’ Land.
Get Creative!
Tiny home financing will require some creativity and persistence. If you have a good relationship with your local bank, consider a personal loan or construction loan to finance your tiny house project. If you are a landowner, you can explore the potential to rent a portion of your land or sell mineral rights or a timber deed to earn money to pay for your tiny home. TinyFest founder, Renee, and her husband Zev, are currently paying for their land through select harvest logging. This may sound intimidating, but you don’t have to be a logger with expensive equipment for this to be an option for you; You can sell a timber deed and have it paid at closing.
Financing Your Tiny Home: So Many Options
As you can see, there are so many options for financing your tiny home dream. From tiny home builder and lenders to services specifically tailored towards tiny homes and ADUs, being a part of the TinyFest community offers the resources and community to solve every problem you may encounter through your journey.
