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FHA – Energy Efficient Mortgage

Sunday, April 30th, 2017

Save Energy, Save Money

Want to qualify for a higher loan amount to fund energy improvements in order to bring down overall living expenses? Talk to the federal government. Its time to consider FHA’s Energy Efficient Mortgage (EEM) Program if you are remodeling your home.

Rising energy prices are pinching everybody and taking the cost of living up and away. Reduce your energy and utility bills by remodeling your house, like replacing leaky pipes and making windows more energy efficient. Making such an investment is easier than you think with the assistance of the Federal Government.

What is EEM or Energy Efficient Mortgage?

Fund energy efficient improvements in all aspect of your home with Energy Efficient Mortgage also known as EEM in short. There are multiple ways of doing this with varying qualification terms. If you choose federal backing, the improvements can be insured by the Federal Housing Authority (FHA). Alternately, approach the Veterans Administration (VA). These improvements could be made using the EPA (Environmental Protection Agency) program called ENERGY STAR or other standard channels.

Qualifying for EEM

Installing energy efficient windows, making the heating and air conditioning system efficient, upgrading water heating system to more efficient ones, upgrading the ducting systems to prevent energy leaks are few of the standard improvements that lead to substantial cost saving in the long run.

The objective of all EEM programs is to save utility costs in the long run. An important criteria of funding improvements is that the overall savings should be higher the amount invested upfront. To help you in determining the viability, the HERS or the Home Energy Rating System carries out a cost benefit analyses by measuring the current energy consumption and the possible savings. If the numbers are favorable, the house qualifies for an EEM.

Advantages of EEM

The key benefit of EEM stems out of the fact that an energy efficient house decreases costs of living and provide for better savings, hence an increased borrowing capacity. In the VA and FHA run programs, you could negotiate betters terms for the mortgage. Energy Efficient systems automatically increase the value of your property besides providing you with a better quality of life.

What Next?

The first step in acquiring an EEM would be to order an HERS survey and report thus ensuring the kind of refinancing scheme that you would qualify for. Shopping for EEM Refinancing scheme is very similar to conventional housing finance. It would do you good to with a lender who is experienced in such refinancing programs. Call for a few proposals and choose the one that suits your best.

Converting your home to a more energy efficient place could be quite an eye opener even prompting you to re-look at your trading in your car for a more efficient hybrid model.