From equity loans to construction financing, we’ll help you choose the smartest path based on your property, income, and timeline.
Here’s how 80% of our Florida clients fund their ADU – and how to decide what’s right for you.
Using your own savings is the most straightforward way to fund your ADU. With no interest or monthly payments, this option gives you full financial freedom and long-term peace of mind.
A home equity loan allows you to borrow against the value of your property. It often comes with lower interest rates and fixed monthly payments for predictable budgeting.
Construction loans are designed specifically for building projects. Funds are released in stages as your ADU is completed, helping you manage costs throughout the build.
With a cash-out refinance, you replace your current mortgage with a new one and use the extra funds to finance your ADU project at competitive rates.
This is a fancy way of saying that you’re getting a new mortgage on your home for an amount that pays off your old mortgage and pulls extra cash out from the value of your equity. You then use that cash to buy your ADU. You’ll pay all the typical refinancing fees, but a cash-out refinance generally offers better interest rates than either a home equity line of credit or a second mortgage. This is the most common and simplest option for those with a good amount of equity in their primary home.
If your loved ones have money to spare, or perhaps just better credit than you do, consider tapping into their goodwill by working out a loan. Pros: The repayment terms can be whatever you both decide, and you’ll be dealing with someone who cares about you personally. Cons: The lender might lord it over you every chance they get, it might change your relationship even if you follow the terms to a T, and if you default…well, let’s not go there.
If you have enough cash in a regular savings account, using it to pay for your accessory dwelling unit is a no-brainer. No interest, no loan paperwork, no bank to bug you about repayment.
You can also borrow from your retirement fund, such as an IRA or a 401(k), which is your own cash as well. You’ll have to pay the loan back within a specified time period (usually five years) and with interest—typically the prime rate plus one or two percentage points. But all that interest will go right back into your retirement fund. You also can withdraw the money outright, but depending on your age, you may have to pay an early-withdrawal penalty. And be cautious about dipping into retirement funds for a home purchase of any kind, so you’re not left high and dry when you do retire.
Leveraging the equity in an owned home is a common way to pay for an ADU. There are two types of home equity financing.
Home equity line of credit (HELOC)
This is a revolving line of credit, typically at a variable interest rate. A lender approves credit up to a certain amount (usually up to 80 percent of the value of your primary home), and then you can borrow from that to pay for your unit and any related costs. You can sometimes find HELOCs without fees or closing costs, but HELOCs in general are less available today than in the past; many banks have stopped offering them in many situations.
Home equity loan (aka second mortgage)
This is a loan for a fixed amount, for a term typically shorter than the first mortgage. As with a first mortgage, you’ll have to pay closing costs and fees such as for an appraisal, credit report, and more; but your first mortgage and its rate stay intact.
Unlike loans based on the existing equity in your primary home, a renovation loan to pay for an ADU is based on the price your home will be valued at once all the improvement work is finished. (Building an in-law unit is considered a home improvement.) If you have less than 30 to 40 percent equity in your primary home, this might be a good option to consider. Note, however, that the bank will want to approve the builder and will release funds over time as construction progresses—adding hassle and complexity for everyone involved.
Interest rates tend to be slightly higher than for refinancing (about 0.125 percent), you’ll have to pay closing costs, and it’s a short-term loan (usually a year or less). But often a renovation loan can be a one-time close, meaning that any remaining debt when the term is up is automatically converted to 30-year financing—so, there’s no reapplying or additional origination fees.
If you have no savings, don’t own a home yet, have no loved ones who can help, and have good credit and a sizable income, your only option may be getting a personal loan or line of credit from a bank or credit union, or drawing on a credit card. All of these typically are free to set up, but the interest rates are so high that you should consider them a last resort, and you likely won’t be able to borrow as much as with other options ($100,000 is generally the max).
Private-money lending, or hard-money lending, can be a good fit for real estate investors or multifamily-property owners. These loans, which are given by an organization or a wealthy individual, require rental income streams to support paybacks and property valuations, and are often designed for a short-term bridge or construction period. The interest rates are higher, but the terms are often discretionary, to allow for creativity and flexibility in their structure as well as simpler, faster underwriting and approvals.
Tech advances and the rise of crowdsourcing have been a boon for ADU buyers, leading to peer-to-peer financing options. Point invests in a portion of homeowners’ equity, paying cash for construction costs. PeerStreet is a “two-sided marketplace for investing in real estate debt.” And there are scads of other general peer-to-peer lending services online. These are all too new for us to recommend them wholeheartedly, but they’re worth checking out.
| Financing Option | Best For | Typical Loan Size | Speed | Payment Structure | Main Pros | Main Risks |
|---|---|---|---|---|---|---|
| Cash / Savings | Homeowners with available funds who want no debt | Full project cost | Fastest | No monthly loan payment | No interest, strongest negotiating position, simplest closing | Ties up liquidity, less cash for overruns/emergencies |
| HELOC | Homeowners with strong equity who want flexibility | Varies by equity | Fast | Draw as needed, often interest-only during draw period | Flexible, good for phased spending, may have lower initial payments | Variable rates, home is collateral, payments can rise |
| Home Equity Loan | Owners who want predictable payments | Lump sum | Moderate | Fixed monthly payment | Stable payment, easier budgeting, good for defined project cost | Less flexible than HELOC, home is collateral |
| Cash-Out Refinance | Owners with favorable refinance opportunity | Larger amounts possible | Slower | Replaces mortgage with new monthly payment | Can fund bigger project, single loan structure | May raise rate on existing mortgage, more closing costs |
| Construction Loan | Ground-up or more complex ADU builds | Based on project budget | Slower | Draw-based, often converts later | Designed for construction, fits staged funding | More paperwork, inspections, lender approvals |
Many homeowners underestimate the budget required for permits, site preparation, utility upgrades, fees, and inspections which can sometimes reach 40% of grand total ADU construction spends.
We help homeowners estimate the full ADU project cost before construction begins, including permits, site preparation, utility upgrades, impact fees, and inspections. With this our customers understand the real budget upfront and avoid unexpected additional costs.
Local approvals, zoning checks, and documentation can take longer than expected and require revisions if at least one mistake is found in plans or other documents.
Our team is handling the permit process from start to finish. We handle all the accurate documentation, zoning checks, and permit submissions. Proper preparation helps prevent revisions, reduces approval delays, and keeps project timeline on track.
Most property owners believe that plugging one more user into existing utility lines is no big deal. However, in reality, utility conditions and capacity may not be sufficient to support one more household, even a very small one.
Before construction starts, we review the existing utility infrastructure and potential upgrade requirements. This helps determine whether electrical, water, or sewer systems need improvements to support the additional unit.
Construction regulations in Florida are strict, and inspections can be challenging for property owners. If a mistake is identified, it must be properly corrected, which can sometimes require rebuilding an entire construction element, such as a wall or flooring.
We focus on building according to code and preparing our objects for inspections at every stage of construction. This reduces the risk of failes and prevents costly rebuilds or delays.
And Reached Positive Cash Flow by Year 2
The ADU was built at a total project cost of $165,000
HELOC: $120,000; Cash Contribution: $45,000
Approximately $1,000/month (interest + principal, depending on rate and repayment plan)
Average long-term rent: $1,900/month
A homeowner in Central Florida wanted to create a reliable source of long-term rental income while increasing the value of their property. At the same time, they wanted to avoid selling their primary residence and didn’t want to drain their personal savings. The solution was to leverage the equity they had already built in their home.
The homeowner qualified for a $120,000 Home Equity Line of Credit (HELOC) and decided to combine it with $45,000 in personal savings to finance the construction of a 1-bedroom detached Accessory Dwelling Unit (ADU) in their backyard. This strategy allowed them to avoid taking on a large construction loan while keeping their monthly financing obligations manageable.
Year 1: Stabilization Phase
During the first year, the property entered the stabilization phase. The ADU was successfully rented out at around $1,900 per month, while the HELOC payment remained close to $1,000 per month.
This created a net monthly surplus of approximately $900. The rental income fully covered the financing costs and still generated additional funds. That surplus helped cover related expenses such as insurance, minor maintenance, and reserve savings for future repairs.
Even in its first year, the ADU was essentially paying for its own financing while beginning to contribute additional income.
Year 2: Positive Cash Flow Position
By the second year, the project had stabilized further. Rental income remained consistent, while a portion of the HELOC principal had already been paid down through regular payments.
At the same time, the property’s overall value increased due to the addition of the ADU. With financing, operational expenses, and reserve allocations covered by the rental income, the property moved into a clear positive cash flow position.
At this stage, the ADU effectively transitioned from being a financed construction project into a reliable income-producing asset.
Long-Term Outlook
If rental rates remain around $1,900 per month, the ADU generates approximately $22,800 in annual rental income. As the HELOC balance continues to decrease over time, the homeowner steadily builds more equity in the property.
Once the loan is fully paid off, the entire rental income becomes profit. Over a 10-year period, this single ADU could generate more than $200,000 in gross rental income, while significantly increasing the resale value of the home.
This project demonstrates how homeowners can strategically use home equity to finance an ADU, create long-term rental income, and transform their property into a powerful wealth-building asset without selling their primary residence.
Building an Accessory Dwelling Unit (ADU) in Florida is a smart way to:
However, many homeowners underestimate hidden costs, delays, and the risks of managing the project themselves. Hiring a full-cycle ADU builder who handles everything from design and permits to construction can save you tens of thousands of dollars.
One of the biggest hidden expenses in ADU construction in Florida comes from permit errors and required corrections. Permit fees typically range from $1,500 to $6,000, depending on your county. If plans are incomplete or incorrect, resubmission fees of $250-$500 per review can add up quickly. Most homeowners require 2-3 resubmissions, totaling $500-$1,500 extra.
Managing multiple contractors: architects ($3,000-$6,000), engineers ($1,500-$4,000), permit runners ($500-$1,500), and general contractors with sub-contractors (20-40% markup) can add $5,000-$15,000 in unexpected costs. Our company handles all roles under one team, removing redundant fees and simplifying communication
Connecting your ADU to water, septic, and electricity often costs $6,000-$10,000 for water/septic and $3,000-$8,000 for electrical. Inspections and surveys add $500–$1,500. Mistakes or inefficient planning can inflate these costs by $10,000-$20,000. Full-cycle ADU builders coordinate all utilities with proper budgeting, avoiding surprises.
Permit fees in Florida range from $1,500 to $6,000, and impact fees can add $5,000-$15,000. Improper submissions may lead to repeat payments, costing an extra $1,000-$3,000. Goshen Tiny Homes ensures fees are minimized legally and efficiently.
Standard ADU construction in Florida costs $150-$350 per square foot. Building an extra 100 sq ft unnecessarily can add $15,000-$35,000. We design ADUs precisely for your needs, avoiding overbuild and saving money while maximizing usable space.
Even minor delays in construction or permitting can cost $1,500-$5,000 per month in lost rental income. A full-cycle ADU builder in Florida reduces construction time by 30–50%, helping you start earning faster.
Mistakes with zoning or setback requirements can result in expensive corrections ($3,000–$7,000) and review delays. Our team verifies compliance before breaking ground, protecting your investment.
Errors in plumbing, electrical, or septic design can cost $2,000-$5,000 per issue. Goshen Tiny Homes select the most efficient solutions for your lot, reducing unnecessary expenditures.
By hiring a professional team, homeowners can save $10,000-$80,000+ through:
These savings come from avoiding mistakes, optimizing permits, and consolidating contractors under one trusted team.
Free property assessment know what’s possible before you commit.
Design, permits, and pricing with a fixed timeline you can count on.
One team, start to finish – your ADU completed as promised.
If we can’t get your ADU approved, you pay nothing.
If we miss our deadline, we’ll put money back in your pocket for every extra week until it’s done.*
*Capped at 8 weeks, details in agreement.
This is a fancy way of saying that you’re getting a new mortgage on your home for an amount that pays off your old mortgage and pulls extra cash out from the value of your equity. You then use that cash to buy your ADU. You’ll pay all the typical refinancing fees, but a cash-out refinance generally offers better interest rates than either a home equity line of credit or a second mortgage. This is the most common and simplest option for those with a good amount of equity in their primary home.
The average cost of ADU or tiny home permits and utility hookups in Florida is usually $10,000–$20,000 total, depending on your property setup. Here’s the breakdown most homeowners see:
Some builders leave permit fees and ADU utility hookups out of their quotes — leading to surprise charges of $10,000–$20,000 later. At Goshen Tiny Homes, we show these costs upfront and handle all permitting and utility coordination, so you get the full picture before construction begins.
👉 Want clarity on the permit cost for an ADU, ADU utility connection fees, septic costs, and the cost to connect an ADU to sewer and water? Schedule your free site review, and we’ll break down all expenses for your property before construction begins.
Yes — a block-built Accessory Dwelling Unit (ADU), sometimes called a tiny house, almost always increases property value in Florida. Because it’s built to the Florida Building Code and appraises like a new construction home, an ADU is treated as real estate — not a temporary structure.
Here’s why ADUs boost value and deliver strong ROI:
ADU ROI Example:
| Property Type | Build Cost / Value | Monthly Rent | Annual Income | ROI |
|---|---|---|---|---|
| Goshen ADU | $200,000 | $2,000 | $24,000 | 12.0% |
| Single-Family Home | $380,000 | $2,466 | $29,592 | 7.8% |
💡 For comparison: According to 2025 Florida real estate data, a typical single-family home in Florida (valued at $380,000, renting at $2,466/month) yields only a 7–8% ROI. That means an ADU investment can nearly double your return.
👉 Wondering how much value an ADU adds to a home in Florida? Schedule a free consultation today and see your potential ROI, rental income, and property appraisal boost with a Goshen ADU.
At Goshen Tiny Homes, our ADU pricing in Florida is truly turnkey — covering everything you need for a complete, move-in-ready Accessory Dwelling Unit (ADU). Unlike some builders who advertise a low “base price” and then add extras, we show you the full picture upfront.
Here’s what’s included in our all-inclusive ADU or tiny home pricing:
These are real ADU costs in Florida, not stripped-down numbers. That way, you never face hidden fees or last-minute surprises — just a transparent path from start to finish.
👉 Curious about what’s included in an ADU or backyard home price? Get your free ADU cost estimate and see how Goshen delivers a true turnkey ADU investment.
Yes — Goshen Tiny Homes offers full support with ADU financing options. Whether you call it a tiny house or a mother-in-law suite, we’ll guide you through lenders who understand ADU projects so you don’t waste time with banks that don’t.
Here are some of the most common ways to finance an ADU:
Typical monthly payments fall between $900–$1,500. In many cases, rental income from the ADU can offset most or all of that payment.
👉 Searching for the best way to finance an ADU in Florida? Schedule your free consultation today, and we’ll connect you with lenders who understand ADU and tiny homes financing — so you can get approved faster and move forward with confidence.
We do not sell pre-built or ready-made ADUs. Goshen Tiny Homes specializes in custom ADU construction, building permanent, site-built units directly on your property.
Whether you call it a granny flat, backyard home, or mother-in-law suite, our units are block-built on slab foundations, fully permitted, and appraised as real estate.
Here’s what that means for you:
What you can expect:
Every project is designed and constructed specifically for your lot – we do not maintain inventory or offer prefabricated units.
We don’t keep “ready-to-move” units in inventory, but we design and build ADU homes — from Tampa and St.Petersburg to Orlando, Miami, Jacksonville, West Palm Beach and beyond.
👉 Searching for ADUs or tiny homes in Florida that count as real property? Check our ADU portfolio to see how Goshen delivers a true home-quality build.
Get clear pricing, zoning guidance, and a step-by-step plan
Helping property owners in Florida to increase their income, foster closer family bonds, and expand their living area with our premium yet economical tailor-made ADUs, leveraging a decade of expertise in the field.
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