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Federal insurance for second liens financing Accessory Dwelling Unit construction.

This bill establishes a new federal program to facilitate the construction of Accessory Dwelling Units (ADUs) by homeowners. The government will insure certain second liens secured against property specifically for financing ADU construction, aiming to increase housing supply and affordability. Citizens gain easier access to capital for property expansion and a potential new source of rental income.
Key points
New Loan Insurance Program: HUD will establish a program to insure second liens used exclusively for financing the construction of ADUs.
Loan Amount Limits: The maximum insured loan amount is capped at the lesser of 30% of the FHA single-unit limit or 100% of the property's projected value after ADU construction (combined with existing debt).
Rental Income Consideration: The loan limit can be increased based on 50% of the projected annual rental income from the new ADU.
Market Liquidity Support: Fannie Mae and Freddie Mac will be permitted to purchase and securitize these insured ADU construction loans, ensuring market stability.
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Status: Introduced
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Additional Information
Print number: 119_HR_4479
Sponsor: Rep. Liccardo, Sam T. [D-CA-16]
Process start date: 2025-07-17
System Note: Lustra is free, publicly auditable civic infrastructure — full source code available on GitHub. You are reading sterilized legislative data, processed by our radical neutrality engine to strip political spin and retain factual mechanics. We process only official government data. Original documents remain the authoritative source—always verify them if you can.
Summarized by: gemini-flash-latest
Source data: api.congress.gov
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OFFICIAL LEGAL TITLE

To amend the National Housing Act to direct the Secretary of Housing and Urban Development to establish a program to insure certain second liens secured against property for the purpose of financing the construction of an accessory dwelling unit, and for other purposes.

FREQUENTLY ASKED QUESTIONS

What is the official ID of this bill?

The official print number for this legislation is 119_HR_4479.

Which chamber initiated this legislation?

This legislation was initiated in the House of Representatives.

When did the legislative process begin?

The process officially started on 2025-07-17.

What are the main provisions?

Key points include:

  • New Loan Insurance Program: HUD will establish a program to insure second liens used exclusively for financing the construction of ADUs.
  • Loan Amount Limits: The maximum insured loan amount is capped at the lesser of 30% of the FHA single-unit limit or 100% of the property's projected value after ADU construction (combined with existing debt).
  • Rental Income Consideration: The loan limit can be increased based on 50% of the projected annual rental income from the new ADU.
  • Market Liquidity Support: Fannie Mae and Freddie Mac will be permitted to purchase and securitize these insured ADU construction loans, ensuring market stability.
What is the specific legal status?

The current status is Introduced.

Where can I read the full text of this legislation?

The full official text is available at: View full text

Who is the primary sponsor?

The primary sponsor is Rep. Liccardo, Sam T. [D-CA-16].

What is the latest detailed status?

The latest detailed status is: Referred to the House Committee on Financial Services.

Is this summary verified?

Yes. This content was analyzed by AI and verified by the Lustra Judge System on 2025-12-31.

What is the impact of this bill?

We don't know—that is up to you to decide. Summarizing raw data with AI is fundamentally different from predicting socio-economic outcomes. As of 2026, we believe impact assessment strictly requires a human in the loop to verify and judge.

CATEGORIES

Real Estate Economy