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Manufactured Home as an Accessory Dwelling Unit (ADU) FAQ

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  1. Are the property eligibility requirements different for a 1-, 2- or 3-unit property with a manufactured home ADU compared to a 1-, 2- or 3-unit property where the ADU is not a manufactured home?

    A manufactured home ADU has the same property eligibility requirements as any other ADU configuration. However, the manufactured home ADU must be titled as real property and meet HUD Code requirements. The appraiser must also provide additional property information specific to the manufactured home. See Single-Family Seller/Servicer Guide (Guide) Section 5601.2 for manufactured home ADU requirements.

  2. When a 1-, 2- or 3-unit property has a manufactured home ADU, what appraisal report form does the appraiser use?

    The appraiser must use Form 70 for a 1-unit property and Form 72 for a 2- or 3-unit property and indicate that the property has an ADU.

  3. What additional information is required on Form 70 or Form 72 when the subject property has a manufactured home ADU?

    The appraisal report must include information that is reflected on the HUD Data Plates and HUD Certification Labels as well as general information on the manufactured home as required in Guide Section 5601.2. Photos of the HUD Data Plates and HUD Certification Labels may be included in the appraisal report to verify this information. The appraisal report must also identify any additions or structural modifications made to the manufactured home. If ADU rental income is being used to qualify the borrower(s) on a subject 1-unit primary residence using Form 70, see Section 5306.3 for additional appraisal requirements.

  4. When the subject property has a manufactured home ADU, does Freddie Mac require the appraisal report to include a comparable sale that also has a manufactured home ADU?

    No. The appraisal report should include at least one comparable sale with an ADU, when available. In all cases, the appraisal report must demonstrate that the ADU is marketable and includes supported adjustments that reflect the market’s reaction to the ADU. See Section 5601.2 for comparable sale requirements for a 1-, 2- or 3-unit property with an ADU.

  5. What are the comparable sale requirements when a subject property with a manufactured home ADU is in an area that does not have zoning or land use requirements defined by the jurisdiction?

    In market areas without zoning or land use requirements, if the subject property has an ADU, the appraisal report must follow the same requirements that apply when a property is legal or legal-nonconforming to the zoning. See Guide Section 5601.2 for comparable sale requirement details.

  6. If an appraiser observes additions or structural modifications to a manufactured home ADU (e.g., attached deck, porch, or garage), is a property inspection required?

    Yes. Any addition or structural modification is required to be inspected by an engineer or local code official to ensure that the structural integrity of the manufactured home has not been compromised. This requirement applies to all manufactured homes.

  7. Does Freddie Mac require the appraisal report to include the cost approach when a manufactured home is an ADU?

    No. The development and reporting of the cost approach is only required when the manufactured home is the primary dwelling unit securing the mortgage.

  8. Is a mortgage secured by a manufactured home that has a manufactured home ADU eligible for sale to Freddie Mac?

    A mortgage secured by a manufactured home with a manufactured home ADU is only eligible when the primary dwelling unit is a CHOICEHome®.

  9. What appraisal report form would the appraiser use when a CHOICEHome is the primary dwelling unit and has a manufactured home ADU?

    The appraiser must use Form 70B and identify the ADU separately as an additional feature. All information required by Guide Section 5601.2 for manufactured home ADUs must also be included on the report.

  10. Is a mortgage secured by a property with a manufactured home ADU eligible for appraised value representation and warranty relief or an automated collateral evaluation (ACE) appraisal waiver?

    Yes. Loan Product Advisor® will evaluate whether the property is eligible to receive an ACE appraisal waiver and Loan Collateral Advisor® will assess eligibility for appraised value representation and warranty relief.

  11. May rental income from a manufactured home ADU be used to qualify a borrower?

    Only under certain circumstances. Rental income from a manufactured home ADU may only be considered if the subject property is a 1-unit investment property, a non-subject investment property, or a 1-unit subject primary residence. See Guide Section 5306.3 for rental income eligibility requirements for ADUs.