What are the benefits of an energy efficient mortgage?
The EEM program recognizes that an energy-efficient home will have lower operating costs, making it more affordable for the homeowners. Cost-effective energy improvements can lower utility bills and make more income available for the mortgage payment.
How does an energy efficient mortgage work?
Energy Efficient Mortgage Programs let you borrow money specifically to pay for energy efficient upgrades to your home. The cost can be added into the mortgage used to purchase a home or rolled into your current mortgage through an energy efficient refinance to allow you to make improvements to the home you have now.
What is a Fannie EEM?
Fannie Mae does offer EEMs. Its HomeStyle® Energy loan lets homeowners finance new energy improvements or pay off debt they incurred to increase the efficiency of their homes. HomeStyle Energy allows you to use up to 15 percent of the “as completed” appraised value of the property for new energy improvements.
How does EEM work?
With the EEM, lenders recognize the savings the upgrades will bring. Borrowers may use these potential savings like extra cash, and add the cost of upgrades into the mortgage, paying them off easily as part of the monthly mortgage payment. Once the upgrades are installed the potential savings turn into real savings.
What is a section 203k loan?
Section 203(k) insurance enables homebuyers and homeowners to finance both the purchase (or refinancing) of a house and the cost of its rehabilitation through a single mortgage or to finance the rehabilitation of their existing home.
What is an energy-efficient loan?
An energy-efficient mortgage is a mortgage-backed (or “secured”) loan, which means that you use your property as collateral. Energy efficiency loans are unsecured loans, more like the personal loans or lines of credit that you can take out from a creditor.
Does Freddie Mac allow solar panels?
Properties with solar panels. Freddie Mac purchases Mortgages secured by properties with solar panels. The property must maintain access to electrical utilities consistent with community standards.
What is an EEM used for?
An Energy Efficient Mortgage (EEM) can be used by borrowers to purchase or refinance a home that is already energy efficient, such as an ENERGY STAR certified home, or to finance energy efficient improvements to an existing home.
What is a FHA EEM loan?
The FHA Energy Efficient Mortgage Program, or FHA EEM, enables borrowers to add the cost of energy-efficient improvements to their FHA loan when they buy a home or refinance their existing mortgage. The $3,000 is added to the buyer’s mortgage for a total loan amount of $193,000.