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Save Money By Making Your House Energy Friendly! Get An Energy-Efficient
Mortgage!
By: John R. Blakefield
Did you know that you can save money by having an energy efficient house? And
you can facilitate this by getting a loan to improve the energy usage of the
house. It is known as an Energy-Efficient Mortgage or EEM and many lenders offer
them to home buyers with energy conservation in mind. You can check with banks
and other institutions who can help guide you in the right direction in finding
this great opportunity.
In order to qualify for an EEM, you must have your house rated for its energy
usage. This energy rating evaluates the entire structure as a whole and does not
consider who is living in it, meaning the assessment is not based on personal
behavior. The energy rating literally assesses the amount of energy used based
on the type windows that are installed in the home, the amount and type of
insulation, as well as the appliances your home uses. It even looks at the type
and quality of major energy users such as cooling and heating systems. The
better quality the structure and the least amount of air leakage in ducts, the
better the energy rating the house will get.
Before you get your house rated for energy usage, be sure to ask the lender what
type of energy rating they want to you to get. A very common rating is the Home
Energy Rating System or HERS, and you can find companies or individuals who can
diagnose a house and give it this rating. The person who does the rating is
either a certified rater or energy auditor who uses information gathered from
the house, inputs it in a computer program, and then produces a report. This
report is used to rate the house and give it a score from 1-100. There is then a
scale of 5 stars that correspond to the amount of points the house has earned.
Not only does this report assess the current energy uses of the house, but will
also give suggestions on ways to improve the energy usage of the home by making
the necessary improvements on the house. It can go as far as to detail the
estimated cost, savings, and break even point for each improvement.
The lender, however, may prefer you to use alternative energy audits that will
determine the same type of information that the lender will use to assess the
amount and terms of the EEM.
In order to qualify for an energy improvement through an EEM, the improvement
must be cost-effective which means that the monthly savings on the utility bills
that are generated by the improvement must be greater than the added monthly
cost of the energy mortgage. Also, your total savings must be greater than your
total costs.
What the EEM is achieving is the ability for a home owner to take out a loan in
order to make the necessary home improvements that will save more money than the
loan costs itself. There will be considerable long term savings as well, after
the loan costs and savings break even.
Actually getting the EEM is like getting a normal mortgage, just there is some
additional paperwork and of course information used to determine the loan amount
and terms. A facilitator can assist you with making the EEM process run
smoothly, making sure everything is completed and filed in a timely manner and
taking some of the work off the shoulders of both the home owner and lender.
The home owner has between about 90 and 180 days to have the improvements made
to the home. The loan amount, usually about 150% of the total cost of
improvements, is placed into an escrow account by the lender and the lender pays
the contracting company directly if so requested. This leaves the home owner out
of the transaction so he or she will not be responsible for the transaction
itself.
An EEM is not only environmentally friendly, but pocket book friendly as well.
At the same time that a home owner is saving money, energy is being conserved
that could be used elsewhere. The government is in full support of the EEM and
will even help finance the energy audit up to $200. This energy audit that
determines the house energy rating can cost anywhere from $100 to $350, $200
being the average.
So you think your home could be more energy efficient? And that your energy
bills could be much lower than what they are? Consider an Energy-Efficient
Mortgage and begin taking steps to getting your home retrofitted for a new life
of energy conservation and more money in the wallet. Not only that, you get to
experience a more efficient and comfortable home after all the necessary
improvements are complete.
About the Author:
John R Blakefield is a mortgage and real estate specialist. For more
information, articles, news, tools and valuable resources on home mortgages or
investment loans, refinancing, debt solutions, visit this site: http://www.scourtheweb.com/mortgage/
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