Two things seem to be on everyone's mind lately – the heat, and the fact that the landscape around us is at its peak “greenness.” Speaking of green, you know that Gil and I like to focus occasionally on ideas to help you live green, being environmentally conscientious. We recently came across an interesting article from Keeping Current Matters, all about the ways in which smart financing can help the environment. Beyond the paperless mortgage that can save trees, there are two loan products that can finance energy efficient improvements to your home. And both can be done at time of acquisition, or during a refinance.
First, there's the FHA 203K, which will finance homes and their renovations up to the local FHA loan limit. In terms of green mortgaging, some borrowers have financed $50,000 solar heating/electrical systems and geo-thermal heating and cooling systems which enable slashing of both energy costs and usage. Besides saving the earth’s resources, over time, customers save money. It’s a win/win.
Then there's a smaller loan that's rarely utilized, despite the fact that it's been around for a few years. It’s called the EEM (Energy Efficient Mortgage), and some of the highlights are:
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It is available as an add-on to VA and FHA loan products, including 203K, for home purchases and refinances.
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It allows a borrower to get an additional 5% of the home price (capped at $8,000 for FHA and $6,000 for VA loans) to finance energy efficient improvements.
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The beauty of the additional funds is that the additional debt incurred in your monthly payment is excluded from your qualifying ratios. The logic is that what will be saved in electric/heating costs will be more than the increased mortgage payment.
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Logistically, your lender will require an independent certification of projected savings prior to closing, and they will hold the monies in escrow, until the work is completed and inspected. Otherwise, it is a fairly simple program that doesn’t alter your required documents or qualifications.
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Some of the more typical uses for the money are: replacement windows and doors, increased insulation, upgraded oil burner, conversion to gas heat, central air, sun lights, small solar panels, even energy saving
Talk to your lender today about the ability to upgrade your home, while benefiting the environment, at the lowest possible interest rates. You – and the earth – will be glad you did!
The Marchany Team KNOWS central New Jersey.We're right where you are, whether you're in South Brunswick or Monroe (Middlesex County). If you're looking for a terrific new home in Mercer County, we're prepared to search for your place in the sun in Princeton Junction, East Windsor, West Windsor, and Robbinsville. And if you're ready to put your Franklin Park or Hillsborough (Somerset County) home on the market, we're prepared to find the buyers who are looking for your home. Call The Marchany Team today at (732) 997-0019, and don't forget to “Like” us on Facebook! We are dedicated to helping you in every way possible.
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