What should I check before I offer on a house with an ADU or a duplex?
Check three things about the home: a unit you can move into, a legal unit count, and a condition a lender will accept. Then ask where the rent number came from.
WHAT MOST PEOPLE ARE NEVER TOLD
You can answer most of this before you offer, from the listing agent and public records. The lender checks the same things, but only after you are under contract and your earnest money is down.
- A unit you can move into. One must be empty, month to month, or near the end of its lease, and state law must let that tenancy end in time. FHA and Fannie Mae rules expect you to move in within 60 days of closing.
- Legal units. The county record and the local zoning should match the listing's unit count. The appraiser must report whether the property is legal under that zoning.
- A permitted ADU. Ask the city's permit office whether the ADU was permitted and may be rented.
- Condition. If the appraiser finds a problem that affects safety, soundness or structure, the appraised value holds only if that repair gets done.
- The rent. Ask for the signed leases on rented units. For an empty unit, ask what similar units nearby rent for.
- Three or four units on an FHA loan. The property must also pass a rent test of its own.
Ask the listing agent first. The county's property record shows the unit count on file. The local zoning office says whether that count is legal.
GOOD TO KNOW
Have your own numbers checked as well, because these checks are about the home. The appraiser's value and rent arrive after you are under contract, and they are the last check the home has to pass.
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WHERE THIS COMES FROM
- Fannie Mae Selling Guide B2-1.1-01, Occupancy Types (11/04/2026)
- Fannie Mae Selling Guide B4-1.3-04, Site Section of the Appraisal Report (06/04/2025)
- Fannie Mae Selling Guide B4-1.3-06, Property Condition and Quality of Construction of the Improvements (06/04/2025)
- Fannie Mae Selling Guide B3-3.8-02, Rental Income from the Subject Property (09/02/2026)
- HUD Handbook 4000.1, FHA Single Family Housing Policy Handbook (last revised 8/12/2026), pages 159 (occupancy), 171 (rent test for three and four units), 808 (zoning) and 829 (repairs)
Researched and written by Series Homes. Checked against its sources on . Lending rules change. This page is general information, not a loan offer or legal or tax advice.