Last progress July 21, 2025 (4 months ago)
Introduced on July 21, 2025 by Sam T. Liccardo
Referred to the House Committee on Financial Services.
This bill would set up a new federal program to help homeowners finance accessory dwelling units (ADUs)—like a backyard cottage, garage apartment, or in-law suite—by insuring certain second loans on their property. The housing department would have up to two years to launch the program. ADUs must include a kitchen, sleeping space, and a bathroom, and can be added to, within, or separate from a single-family home. They can be modular, manufactured, or a conversion of an existing structure.
The insured loan size would be capped based on federal limits and the expected value of the home after the ADU is built, with up to half of projected ADU rent allowed to boost the cap. The yearly insurance fee could not be more than 1% of the insured amount. Owners must certify they own the property, and the department must report to Congress each year on how the program is working. To keep lenders active in this space, the housing finance regulator would allow Fannie Mae and Freddie Mac to buy and bundle these insured loans, unless it finds that market risks are too high and formally notifies Congress of a pause.
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