New loan program from Meredith Village Savings Bank caters to in-law apartments

Meredith Village Savings Bank is expanding its mortgage loan offerings with a specialized program to finance the construction of more housing in the Lakes Region.

“The new solution will give local homeowners a new option for financing the addition of an attached or detached living space to their existing residence, without adjusting the rate on their current mortgage,” spokesperson Jaron Jenkins wrote in a news release. 

The mortgage program focuses on accessory dwelling units, or ADUs, which are fully self-contained housing units complete with kitchen, bathroom and living and sleeping areas. According to New Hampshire state law, homeowners may build ADUs by right, so long as they keep in accordance with relevant local or municipal ordinances and regulations.

“As a community-focused bank, we’re dedicated to addressing local housing concerns, and accessory dwellings are a great way for residents to modify their home to meet their evolving needs,” Charlie Dowd, MVSB vice president of residential mortgage sales, wrote in the news release. “Whether it is for generational housing or to create supplemental revenue through an ADU — we are proud to provide a financing solution tailored for this purpose.”

As of June 1, 2017, State law requires local municipalities to allow the development of ADUs by right, in nearly all areas where single-family houses are permitted. 

That law, RSA 674:71-73, was born out of Senate Bill 146, signed into law by former Gov. Maggie Hassan in 2016. It defined accessory dwelling units as residential living units within or attached to a single-family dwelling, and provide independent living facilities for one or more people, including provisions for sleeping, eating, cooking and sanitation on the same property as the principal dwelling unit it accompanies. 

While the law calls them ADUs, they’re also known colloquially as “accessory apartments” or “in-law apartments” and, no matter what an individual municipality’s zoning ordinance calls them, they’ve got to be permitted by right. 

Loads of municipal zoning ordinances already address the development of ADUs, and generally have standards and restrictions associated with them. Municipalities with zoning ordinances that did not address ADU development at the time of codification may have implicitly allowed for ADU development without restrictions. Some municipalities implement guidelines or restrictions on ADU development, including allowing just one ADU per dwelling; requiring owner-occupancy; defining minimum and maximum sizes; ensuring adequate parking; or requiring aesthetic continuity.

In the City of Laconia, according to its zoning ordinance, the appearance and character of the dwelling “must remain single-family in nature”. A single-family dwelling with an ADU is not considered a two-family dwelling, and one ADU is permitted on any owner-occupied single-family dwelling, so long as certain conditions are met. 

For example, in Laconia, an ADU must be located in the same building as the principal dwelling unit or in a separate, detached structure like a garage or a barn. Any new structure must conform to the required dimensional standards for the respective zoning district. Additionally, the property owner must occupy either the principal dwelling unit or the ADU as their primary residence, and the owner must provide to the city documentation that demonstrates one of the units as being their primary residence. 

When considering the addition of an ADU on your property, it is best to consider the language of the zoning ordinance applicable to the municipality in which you live to ensure compliance. 

To learn more about financing ADUs, visit mvsb.com/adu.