If you’ve ever considered energy efficient upgrades for your home, you now have an added incentive. In addition to federal tax credits and rebates, you can now get assistance for financing the improvements with help from Fannie Mae, reports DWM Magazine.
HomeStyle® Energy Mortgage
HomeStyle® Energy mortgage is a new Fannie Mae option that allows borrowers to finance energy-efficient improvements, such as insulation or window enhancements. Homeowners can borrow up to 15 percent of the appraised, as-completed value of the home in order to purchase the upgrades. Financing is available to both those looking to purchase homes and those who want to update their current homes.
Where to Find It
HomeStyle Energy mortgage is available from all approved Fannie Mae lenders. Borrowers can finance up to $3,500 in upgrades without an energy report, or upgrades above this limit with an energy report. Lenders are required to place funds into an escrow account.
Why It Makes Sense
According to Fannie Mae senior vice president and chief credit officer, Carlos Perez, “HomeStyle Energy mortgage will be particularly helpful to borrowers who want to pay off debt for existing energy improvements. It will also benefit homeowners who want to make their home more comfortable and efficient.”
An article in Mother Earth News further validates the investment, explaining that, “Home energy efficiency improvements are good for your bank account, too, because money you invest in energy efficiency or renewable energy systems will pay off over time in reduced energy bills.”
What You Should Know Before Applying
In addition to making these loans available, Fannie Mae also makes them more affordable than typical home equity lines of credit, unsecured loans or vendor loans. Although most Property Assessed Clean Energy (PACE) loans aren’t eligible for Fannie Mae mortgages, they can be paid off using this option.
Learn more about HomeStyle Energy mortgage from Fannie Mae, or explore additional financing options and federal incentives offered for energy efficient upgrades.