Bill > HR4568

This bill establishes a new federal program through the Department of Housing and Urban Development (HUD) to provide insurance for second liens specifically used to finance the construction of accessory dwelling units (ADUs). The program, to be implemented within two years, allows homeowners to obtain insurance for a second loan up to 30% of the value of a one-unit residence, or up to 100% of the property's projected value after ADU construction. Borrowers can potentially increase their loan amount by including projected rental income from the ADU. The insurance premium is capped at 1% of the principal amount annually. An ADU is defined as a modular, prefabricated, or converted unit with kitchen, sleeping, and bathroom facilities, which can be added to, created within, or detached from a single-family dwelling. The bill also directs the Federal Housing Finance Agency to allow Fannie Mae and Freddie Mac to purchase and securitize these insured loans, with the ability to prohibit such purchases if market risks are deemed excessive. HUD must submit annual reports to Congress detailing the program's activities, and the agency is authorized to develop specific rules for implementation.

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https://www.congress.gov/bill/119th-congress/house-bill/4568/all-info