For reference, Freddie Mac's weekly survey put the average 30-year fixed mortgage at 7.32% and the 15-year at 6.68% for the week of October 22, 2026. That's a benchmark for first mortgages, not a quote, and the loans most owners use for an ADU are priced differently: a HELOC usually has a variable rate that moves with the market. That's why the tables below run from 6% to 9%. Find your row, then swap in the rate your lender actually offers. For which loan to use, see ADU financing: how to pay for an ADU.
How the ADU loan calculator works
Every fixed-rate, fully amortizing loan uses the same formula. A lender's quote should match it to within a dollar or two.
M = P × r × (1 + r)n ÷ ((1 + r)n − 1)
- M is the monthly payment of principal and interest.
- P is the amount you borrow.
- r is the monthly rate: the annual rate divided by 12. At 7.32%, r = 0.0732 ÷ 12 = 0.0061.
- n is the number of monthly payments: 360 for 30 years, 240 for 20, 180 for 15.
Worked example: $300,000 at 7.32% for 30 years. (1.0061)360 is about 8.93, so M = 300,000 × 0.0061 × 8.93 ÷ 7.93, or $2,061. We computed every figure on this page with that formula and then checked each one with a month-by-month simulation that ends at a zero balance. Payments are rounded to the nearest dollar and exclude taxes, insurance, mortgage insurance and fees.
ADU loan payment by amount and rate
Start with the 30-year term, which gives the lowest payment and is common for a cash-out refinance or a renovation mortgage such as Fannie Mae HomeStyle.
| Amount borrowed | 6% | 6.5% | 7% | 7.32% | 7.5% | 8% | 9% |
|---|---|---|---|---|---|---|---|
| $100,000 | $600 | $632 | $665 | $687 | $699 | $734 | $805 |
| $150,000 | $899 | $948 | $998 | $1,030 | $1,049 | $1,101 | $1,207 |
| $200,000 | $1,199 | $1,264 | $1,331 | $1,374 | $1,398 | $1,468 | $1,609 |
| $250,000 | $1,499 | $1,580 | $1,663 | $1,717 | $1,748 | $1,834 | $2,012 |
| $300,000 | $1,799 | $1,896 | $1,996 | $2,061 | $2,098 | $2,201 | $2,414 |
| $400,000 | $2,398 | $2,528 | $2,661 | $2,748 | $2,797 | $2,935 | $3,218 |
| $500,000 | $2,998 | $3,160 | $3,327 | $3,435 | $3,496 | $3,669 | $4,023 |
Two shortcuts fall out of the table. Each extra point of rate adds roughly $65 to $71 a month per $100,000 at these levels. And payments scale in a straight line with the amount, so $350,000 is the $300,000 row plus half the $100,000 row.
A cash-out refinance replaces your whole first mortgage, so the rate applies to your existing balance too, not just the ADU money. If you hold a low rate today, price the full new loan in this table, not just the ADU share, before choosing it over a HELOC.
Payments and total interest by term
A shorter term raises the monthly ADU loan payment but cuts the interest you pay by a wide margin. Second loans, such as a home equity loan or the repayment phase of a HELOC, are often shorter than 30 years, so check the 10-, 15- and 20-year columns for those.
| Amount borrowed | 10 years | 15 years | 20 years | 30 years |
|---|---|---|---|---|
| $100,000 | $1,178 | $917 | $795 | $687 |
| $150,000 | $1,766 | $1,375 | $1,192 | $1,030 |
| $200,000 | $2,355 | $1,834 | $1,589 | $1,374 |
| $250,000 | $2,944 | $2,292 | $1,987 | $1,717 |
| $300,000 | $3,533 | $2,750 | $2,384 | $2,061 |
| $400,000 | $4,711 | $3,667 | $3,178 | $2,748 |
| $500,000 | $5,888 | $4,584 | $3,973 | $3,435 |
| Rate and term | Monthly payment | Total interest paid |
|---|---|---|
| 7.32%, 30 years | $2,061 | $441,885 |
| 8%, 30 years | $2,201 | $492,466 |
| 7.32%, 20 years | $2,384 | $272,128 |
| 8%, 20 years | $2,509 | $302,237 |
| 7.32%, 15 years | $2,750 | $195,079 |
| 6.68%, 15 years | $2,643 | $175,758 |
Over 30 years at 7.32%, you pay more in interest than you borrowed. Going from 30 years to 20 adds $323 a month and saves about $170,000. If the ADU will be rented, the rent can carry a shorter term; see ADU rental income in San Diego for current rents before you count on it.
HELOC payments: draw vs repayment
A HELOC has two phases. During the draw period you can borrow up to your limit, and many lenders let you pay interest only. When it ends, the CFPB warns that you can no longer borrow and minimum payments are often much larger. Some plans leave a balloon payment at the end if you only ever make the minimum.
Interest-only payment = balance × annual rate ÷ 12. The repayment column below assumes the balance is then repaid over 20 years at the same rate.
| Balance | 7% interest-only | 7% repaying | 8% interest-only | 8% repaying | 9% interest-only | 9% repaying |
|---|---|---|---|---|---|---|
| $100,000 | $583 | $775 | $667 | $836 | $750 | $900 |
| $200,000 | $1,167 | $1,551 | $1,333 | $1,673 | $1,500 | $1,799 |
| $300,000 | $1,750 | $2,326 | $2,000 | $2,509 | $2,250 | $2,699 |
| $400,000 | $2,333 | $3,101 | $2,667 | $3,346 | $3,000 | $3,599 |
Interest while the ADU is built
A HELOC's advantage on an ADU is timing. California law caps a contractor's down payment at $1,000 or 10%, whichever is less, and bars payments ahead of finished work, so you only need the money as each stage is done. The table follows the Contractors State License Board's sample ADU payment schedule on a $300,000 contract. It assumes one milestone a month and an 8% interest-only HELOC.
| Month | Milestone paid | Share | Balance drawn | Interest that month |
|---|---|---|---|---|
| 1 | Mobilization | 5% | $15,000 | $100 |
| 2 | Demolition and site prep | 10% | $45,000 | $300 |
| 3 | Foundation | 10% | $75,000 | $500 |
| 4 | Framing | 15% | $120,000 | $800 |
| 5 | Rough plumbing, electrical and mechanical | 15% | $165,000 | $1,100 |
| 6 | Roof and exterior wrap | 15% | $210,000 | $1,400 |
| 7 | Insulation and drywall | 10% | $240,000 | $1,600 |
| 8 | Flooring, tile and cabinets | 10% | $270,000 | $1,800 |
| 9 | Finish trades and carpentry | 5% | $285,000 | $1,900 |
| 10 | Final inspection | 3% | $294,000 | $1,960 |
| 11 | Keys after punch list | 2% | $300,000 | $2,000 |
Total interest over those 11 months: about $13,460. With a home equity loan, you borrow the full amount at closing and pay interest on all of it from day one: about $22,000 over the same 11 months at 8%. Real builds rarely move one milestone a month, and permit waits can stretch the start, so treat this as the shape of the cost, not a forecast.
Renovation mortgages work differently. With Fannie Mae HomeStyle, the whole loan closes up front, including the renovation money, which sits in an escrow account and is released as work is completed. Because it's all one loan, you pay interest on the full amount from closing, even on money still waiting in escrow.
ADU financing calculator: how much to borrow
The loan amount starts with the price of the ADU. Snap ADU's published San Diego prices (March 2026) run about $300,000 for a 500-square-foot detached ADU, $350,000 for 750, $425,000 for 1,000 and $450,000 for 1,200, before city fees and unusual site work. Its table of City of San Diego fees (February 2026) adds $10,734 at 499 square feet and $25,138 at 749. Get your own number from the ADU cost calculator or our breakdown of what an ADU costs in San Diego.
| Step | Example | Your numbers |
|---|---|---|
| Build price | $350,000 (750 sq ft, Snap ADU base, March 2026) | Your written bid |
| City fees | $25,138 (749 sq ft, Snap ADU table, Feb. 2026) | Your city's fee estimate |
| Contingency | $35,000 (10%, our assumption) | 10% to 15% of the bid |
| Total cost | $410,138 | Add the rows above |
| Cash you put in | $110,138 | Savings you won't need for anything else |
| Amount to borrow | $300,000 | Total minus cash |
| Monthly payment | $2,061 at 7.32%, 30 years; $2,509 at 8%, 20 years | Read it from the tables above |
Your lender then checks two limits: how much equity you have and how much payment your income supports. Lenders set their own maximum combined loan-to-value for home equity borrowing, so ask yours for the number. The check itself is simple: multiply your home's value by that limit and subtract what you owe. On a home worth $1,000,000 with $500,000 owed, an 80% limit leaves $300,000 of borrowing room; a 90% limit leaves $400,000. Those limits are examples, not quotes.
If you don't have that much equity, renovation loans lend against the finished value instead. Fannie Mae HomeStyle caps renovation costs at 75% of the as-completed appraised value on a refinance.
What to add to the loan payment
Principal and interest is only part of what the ADU costs you each month.
- Property tax on the new unit. California's base rate is 1% of assessed value plus voter-approved local debt, and new construction is assessed when it's finished. In San Diego County only the ADU is added; the existing home keeps its assessment. At 1% alone, an ADU that adds $300,000 of assessed value adds about $250 a month before local bonds.
- Insurance. Ask your insurer what adding the ADU does to your homeowner's premium, and whether you'll need a landlord policy if you rent it.
- Utilities and upkeep you'll pay yourself if the unit is for family or if rent includes them.
- Rate changes on a variable-rate HELOC. Rerun the tables a point or two higher to see what you can absorb.
A worked total: $300,000 at 8% over 20 years is $2,509, plus about $250 in base property tax, before insurance. If that's more than you want to carry, a smaller unit lowers every line. A junior ADU or a garage conversion usually costs far less to build. When you're ready for bids, start from verified ADU builders in San Diego and check a contractor's license before you sign.
Common questions
How do I use an ADU loan calculator?
What is the monthly payment on a $300,000 ADU loan?
What is the monthly payment on a $200,000 HELOC for an ADU?
What interest rate should I use in an ADU financing calculator?
How much interest will I pay while my ADU is being built?
Sources
- Freddie Mac, via GlobeNewswireMortgage Rates Decrease to 7.32% (Primary Mortgage Market Survey, October 22, 2026)
- Consumer Financial Protection BureauWhat is a home equity line of credit (HELOC)?
- Consumer Financial Protection BureauMy lender offered me a HELOC. What is a HELOC?
- Consumer Financial Protection BureauWhat other types of loans are similar to a HELOC?
- Contractors State License BoardFast Facts: Accessory Dwelling Units (Rev. 11/2025)
- California Legislative InformationBusiness and Professions Code § 7159.5 (down payments and progress payments)
- Fannie Mae Selling GuideB5-3.2-02, HomeStyle Renovation Mortgages: Loan and Borrower Eligibility (12/10/2025)
- Fannie Mae Selling GuideB5-3.2-04, HomeStyle Renovation Mortgages: Costs and Escrow Accounts (12/10/2025)
- Snap ADUADU Costs in San Diego (updated March 2026)
- Snap ADUAll about ADU fees and waivers (fee table updated February 2026)
- California State Board of EqualizationCalifornia Property Tax: An Overview (Publication 29)
- San Diego County AssessorReassessments
General information, not legal or financial advice. Rules and fees change; confirm with your city's permit office before you rely on them.