Residential buildings annually use more than 20% of the nation's energy, and the majority of those buildings are existing homes. Yet, most of the attention to energy efficiency has been in new construction.
Recently, however, the U.S. Department of Energy (DOE) and the more than 1.3 million members of the National Association of Realtors (NAR) have joined together and are currently working on a number of projects to play a far more active role in meeting the growing demand for energy efficiency and "green" features in existing homes.
Home Energy Rating Systems (HERS) were created to help people evaluate and compare energy efficiency levels of existing homes, and identify ways to improve them. In addition, this system offers a standardized measurement for the financial community (such as mortgage companies) to use. HERS-rated homes often qualify for "energy efficient" mortgages. In addition, homeowners can now obtain refinancing to make HERS-related energy efficiency improvements.
If your client is selling their home, a low HERS rating is a guarantee that a home is energy efficient and will save the buyer energy dollars. If our HERS evaluation recommends energy efficiency improvements, your client may wish to increase the value of their home by making the recommended improvements.
If your client is buying a home, many mortgage companies recognize that owners of energy-efficient homes pay much lower energy bills. Accordingly, many mortgage lenders will let a buyer "add" energy-related costs (such as the HERS evaluation or HERS-recommended energy efficiency improvements) to the overall loan total.
Home Energy Rating: Key to Getting an Energy-Efficient Mortgage (EEM)
One of the keys to getting an energy-efficient mortgage or energy improvement mortgage is having a certified home energy rater conduct an energy audit of the home before financing is approved. This verifies for the lender that the home is efficient, or notes areas that need improvement to save money on monthly energy bills. The cost of these improvements then can be added to the mortgage.
Let us help you help your clients increase the value of their homes by identifying energy efficient improvements.