Thinking About Going Green on your Phoenix Home Mortgage? VA Energy Efficient Mortgage (EEM) Program May Be The Solution

The VA Energy Efficient Mortgage Program allows a veteran, using a VA Home Loan, to upgrade their Phoenix home at the time of purchase or as a refinance, if the borrower already owns the property. The program allows the veteran to finance up to $6,000 in cost of those upgrades into their home mortgage.  This is a great program for those who want help protect the environment and save money. 

Allowable energy efficient improvements include, but are not limited to, the following items:

• Solar heating systems, including solar systems for heating water for domestic use
• Solar heating and cooling systems
• Caulking and weather-stripping
• Furnace efficiency modifications limited to replacement burners, boilers, or furnaces designed to reduce the firing rate or to achieve a reduction in the amount of fuel consumed as a result of increased combustion efficiency, devices for modifying flue openings which will increase the efficiency of the heating system, and electrical or mechanical furnace ignition systems which replace standing gas pilot lights.
• Clock thermostats
• New or additional ceiling, attic, wall and floor insulation
• Water heater insulation
• Storm windows and/or doors, including thermal windows and/or doors
• Heat pumps
• Vapor barriers

A loan for existing property or a new home may be increased by up to $6,000 for energy efficiency improvements at the option of the lender and veteran at any time up to the loan closing without VA's prior approval.  The lender will need evidence of the cost of improvements, such as a copy of the bid(s) or contract itemizing the improvements and their cost, and the lender's determination that the increase in monthly mortgage payments does not exceed the likely reduction in monthly utility costs.

Upon closing, the funds added to your loan amount for the energy efficient improvements will be held in an escrow account until your improvements are completed.  Once you notify the lender that the improvements are completed, an inspection is done to verify completion and the funds will then be released.