ADU Loan Program
Salt Lake City homeowners on the Westside now have access to affordable financing to build an Accessory Dwelling Unit (ADU) — also known as a basement apartment, backyard cottage, or mother-in-law suite. This new program, administered in partnership with the Community Development Corporation of Utah (CDCU), is designed to increase affordable housing options and help residents build wealth.
What the Program Offers
| Feature | Details |
|---|---|
| Max Loan Amount | $200,000 |
| Interest Rate | 3% fixed |
| Term | 5 years, with a 5-year extension option |
| Amortization | 30 years |
| Loan Forgiveness | Up to 10% for rent-restricted ADUs |
| Application + Origination Fee | $2,000 (may be rolled into loan) |
| Compliance Fee | $200/year for affordability verification |
Who’s Eligible?
Owner-occupants building an ADU on their west side property (west of I-15 in Salt Lake City) may qualify.
Homeowners located within Salt Lake City’s 9-Line Community Reinvestment Area — which runs along 900 South between I-15 and the Jordan River — will receive loan priority, as this area has dedicated funding set aside for ADU development.
✔️ Must live west of I-15
✔️ Must use the property as a primary residence
✔️ Must complete Salt Lake City’s Good Landlord training
✔️ Must participate in financial counseling
There are two ways to participate:
| Household Income | Rental Requirements |
|---|---|
| ≤ 80% AMI | No rent restrictions — live in or rent your ADU at any price |
| > 80% AMI | You must rent either the main home or the ADU at a price affordable to renters earning 80% AMI or less |
Curious how you’d qualify? Learn more about Area Median Income (AMI) and use an online calculator to estimate your household income level.
How to Apply
Loans applications are accepted as funding is available. All will be administered through CDCU.
Want to be notified when applications open? Join the interest list here.
Additional Resources
Looking to build an ADU but not sure where to start? These resources will help you understand the requirements, streamline your approval process, and connect with city planning staff for support.
Get an overview of what’s allowed, how to apply, and key zoning and building code requirements.
View the ADU Handbook (PDF)
Speed up your project with pre-approved ADU designs. These plans meet city building codes and can simplify the permitting process.
Explore Pre-Approved ADU Plans