Homeowners may begin to focus on making their home more energy efficient. Not only can incorporating energy-efficient appliances and features help decrease energy waste, but these upgrades also can help lower utility bills, too.
Homeowners also could embark on more extensive projects like adding solar power or even just installing an energy-efficient heating and cooling system. Some of these improvements, though, could qualify for an energy-efficient mortgage program. What is an energy-efficient mortgage program, though? Here’s what homeowners need to know about these mortgage programs and who can qualify.
Different Types of Energy-Efficient Mortgage Programs
There are different energy-efficient mortgage programs available to homeowners. One program is offered through the U.S. Department of Housing and Urban Development (HUD). The energy-efficient mortgage offered by HUD provides two different mortgage options. One helps make older homes more efficient and comfortable, the other focuses on “Cost-effective energy-saving measures…” that can be included in the mortgage.
To qualify, homeowners need to get an energy assessment that will detail the recommended improvements, the price of the improvements, and how much money those improvements will save. HUD explains that these improvements must be cost effective; this means that homeowners should save as much money or more than the renovations cost.
Not all improvements/renovations are going to be cost effective or included in an energy-efficient mortgage. For example, many homeowners upgrade appliances to energy-efficient options but these won’t aren’t the big improvements that lenders are looking at for an energy-efficient mortgage (EEM). EEMs aren’t going to finance that new fridge!
Other EEM Options
For homeowners interested in pursuing an energy-efficient mortgage, ENERGY STAR offers a list of options. In addition to the HUD EEM program, lenders Freddie Mac and Fannie Mae also offer programs.
Homeowners should talk to their bank or lender to get all the details and to find out who can qualify for these programs. Fannie Mae’s HomeStyle Energy Mortgage includes renovations like smart thermostats, HVACs, energy-efficient windows/doors, water heaters, and weatherization/insulation.
Other Ways to Embrace Energy Efficiency
While exploring an energy-efficient mortgage could help homeowners make older homes more energy-efficient, there are other ways all homeowners can save energy. Some of these upgrades are free, but others may require a little financial investment.
- Use Film to Insulate Windows
Add more protection to windows with window film. This material can be purchased at home improvement stores and is simple to install. The film adds an additional layer of protection and helps keep the cold air or hot air from creeping into the home.
- Adjust the Thermostat
During the cold winter, there is no reason to turn up the heat to 75 degrees. Yes, it may feel balmy, but homeowners are just wasting energy and racking up a high energy bill, too. During cold winter months, turn down the heat to 68 degrees. In the summer, even when the heat is atrocious, opt for the air conditioning to be adjusted to 78 degrees. During 90 degree days, that midrange temperature will still feel cool.
- Install Touch-Free Faucets
For homeowners who have a bad habit of leaving the water running when they brush their teeth or wash their hands, install a touch-free faucet. These faucets have motion sensors and turn on and off automatically. Sometimes homeowners may have to wave their hands a bit, but water waste won’t be such an issue.
- Turn off the Lights and Upgrade the Bulbs
The home doesn’t have to be lit up like a Christmas tree. When leaving a room, remember to turn off the lights. This is a good habit to adopt, because so many homeowners tend to leave lights on throughout the home. Swap out old light bulbs for LED options; they may be more expensive, but they can last for years.
- Run Only Full Loads of Dishes and Laundry
Stop wasting water and electricity for small loads of dishes and laundry. Wait to run the dishwasher until it’s completely full. When doing laundry, don’t just wash a few items. Small loads are wasteful.
- Don’t Throw a Log on the Fire
Does the home have a nice old fireplace? Don’t use it for heat! Traditional log-burning fireplaces are energy drains. Most of the heat escapes from the chimney. Instead, transform the old model into an energy-efficient fireplace with a gas insert. A pro can help!
- Upgrade the Doggy Door
The dog door that is so convenient for Fido might be an energy drain. Upgrade the dog door to a more insulated, energy-efficient option. Otherwise, the HVAC may be working overtime.
While an energy-efficient mortgage program can help homeowners fund more extensive energy-efficient projects, all homeowners can make changes to decrease their energy waste and save money. For those interested in an EEM, though, contact a lender to find out more about these special mortgages.
