dealpal Staff asked 3 years ago Okay so I need some assistance here. I’m in Arkansas and the place I’m looking to purchase has an Additional Dwelling Unit. I looked on page 4 of chapter 12 in the HB-1-3555 and it states that a second additional dwelling isn’t necessarily a loan breaker. The appraiser must look at certain details and indicate whether they feel the ADU would be considered a possible rental unit and/or multi family unit or if the property including dwelling is just a single family unit. I looked on the appraisal and it does indicate it doesn’t have separte utilities, not going to be used as a rental unit. Plus the unit is pretty much a storage now, it was used as a personal deer processing camp, it has a kitchen but the stove doesn’t work, full bathroom, one window that opens a quarter of the way and just one door. I’ve read regulations and it states minimum of 2 doors and a workable window, if you consider the entire square footage is less than 500 sq ft and if you put a bed in the supposed area it is less than the 70 sq ft for a required bedroom space. The USDA kicked back application saying they are concerning with the ADU and I showed the LO the HB section plus the part on the appraisal report. Will USDA accept this and perhaps approve the loan or is there a certain definition or classification that I can call it to where they might accept it? I call it a man cave. lol