Arizona ADU Loan Calculator
Arizona ADU policy opened up after HB2720, and Phoenix and Scottsdale are now permitting detached units at record rates. Use this calculator to compare monthly payments across HELOC, construction-perm, and cash-out refi against realistic Arizona ADU build costs.
Enter your project details
Loan amount: $168,000
HELOC
Variable rate, interest-only draw option
Flexible line of credit. Only pay interest on what you draw.
Construction-Perm
Draws during build, converts to mortgage
Funds disbursed by milestone. Permanent loan activates at completion.
Cash-Out Refi
Replaces your current mortgage
Combines existing mortgage + ADU cost into one new 30-year loan.
Rent-coverage estimate
Typical ADU rent in the Mountain region runs about $1,900/mo. That covers roughly 140% of the featured HELOC monthly payment shown above.
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ADU loan product comparison
| Product | Typical rate | Term | Best for |
|---|---|---|---|
| HELOC | 7.5–10.5% variable | 10 draw + 20 repay | Homeowners with 20%+ equity who want flexibility |
| Home Equity Loan | 7.3–10.3% fixed | 10–30 yr | Borrowers who want a fixed monthly payment |
| Cash-Out Refi | 7.5–8.5% fixed | 30 yr | Current mortgage rate already near market |
| Construction-Perm | 8.0–12.0% | 12–18 mo then 30 yr | Ground-up builds over $200K |
| DSCR | 8.5–12.0% | 30 yr | Investors qualifying on rent |
| RenoFi | 8.0–11.0% | 10–20 yr | Limited current equity, new-build ADUs |
Frequently asked questions
What is the best ADU loan in Arizona?
For Arizona homeowners with 20%+ equity, a HELOC or fixed home equity loan is typically the cheapest way to finance an ADU. For new-construction builds over $200,000, Arizona lenders increasingly offer construction-to-permanent loans that fund in draws and convert to a 30-year mortgage at completion. Investors with a rental plan often use a DSCR loan that qualifies against projected ADU rent.
How much does an ADU cost to build in Arizona?
Typical detached ADU builds in Arizona land between $140,000–$290,000. A 750 sq ft two-bedroom unit in Phoenix usually falls mid-range, while high-end coastal builds push higher once soft costs, site prep, and utility hookups are counted.
Are there state-level ADU grants in Arizona?
Active grant programs rotate frequently. We list the current state-level programs in the calculator above. Note: the CalHFA ADU Grant Program closed to new applications in December 2023 after all funds were allocated, so California homeowners should look to municipal fee waivers and lender-side incentives instead.
How long does ADU loan approval take in Arizona?
HELOC and home equity loans typically close in 3–5 weeks. Construction-perm loans take 6–10 weeks because the lender must review plans, permits, and a draw schedule. Getting pre-approved before you finalize designs shaves weeks off the project timeline.
Rebuild your cost estimate with different inputs.
Project long-term return on your ADU investment.
Complete guide to every ADU loan product.
Managing a Construction Loan? Stay on Top of Every Draw.
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