HOW ENERGY EFFICIENT MORTGAGES WORK
Energy Efficient Mortgages help home buyers cover the costs of making energy efficient improvements the home during the purchase process. In most cases, the upgrades are completed within 90 or fewer days after closing. Scroll down learn how and the steps to get started!
Energy Efficient Mortgages are incredible in many way. First, they allow you the chance to roll improvements into your loan at the time of purchase. The benefits will you save money in your utility bills, increase the value of your home and you will be eligible for various tax and utility credit credit option. How much can you save and earn? That depends on your house and the type of energy efficient upgrades you do.
Have a home to sell too?
Consider an energy efficient renovation loan to increase value BEFORE you put your home on the market. Increase the value of the home by offering lower utility bills while you market your home as “Green.” Eligible “green” improvements include, but are not limited to, solar heating and solar water heating systems, non-solar energy efficient heating and cooling systems, caulking and weather-stripping, clock thermostats, new or additional ceiling, attic, wall, floor and water heater insulation, insulated windows and/or doors, heat pumps, and vapor barriers, and more.
Here are some additional highlights:
–VA, FHA and Fannie Mae purchase mortgage options to renovate a home to turn it “Green” aka Energy Efficient.
–Up to$35,000 money built into loans to increase energy efficiency (terms apply)
–Up to $9,000 in Tax credit opportunities in addition to Arizona Utility Credits about $1,000 and Federal credits (terms apply)
–Minimim credit scores required starting at 580 to 720 depending on program.
–Jumbo product with 10-20% down.
–Energy Audit by a Certified Energy Auditor will take place during inspection period (paid for by buyer, but credited at close by lender).
–Preferred title company, Driggs Title, working with the program to pay contractors.
In addition; each Homeowner may also get these benefits:
–$7,000 to $9,000 in Tax and Utility Credits – Learn more about Tax Credits here!
–Average home Utility bill fell $200 a month and;
–Average home value increase could be as much as 11%.
BELOW ARE FOUR STEPS TO ENERGY
EFFICIENT HOME OWNERSHIP
Get Pre-approved with an Energy Efficient Mortgage lender
Having a pre-approved loan will: ensure one knows the price range of homes to be shopping and are comfortable with the total monthly payment, down payment, costs to close and to understand the requirements of Renovation loans. Not all lenders know how or offer Energy Efficient Mortgages. We work with an approved lender who has extensive experience in Arizona with these types of loans. Learn more about our recommended and experienced Energy Efficient Mortgage lender at: http://www.gsfeem.com
Locate or Qualify the Home
The following types of properties will qualify for an Energy Efficient Mortgage (EEM).
Single Family Homes
Multi-Units (Duplex, Triplex or Fourplex)
Condo/Towhome or Patio Homes
If you are looking to a buy a home, you have an incredible opportunity to buy a home and immediately save money on your utilities, increase the value of your home, and earn tax credits for doing the energy renovations. We will help you do research to locate a home and schedule homes showings for properties that fit your wants and needs and the loan requirements best.
The FHA, VA and Fannie Mae programs allow for the greater of $4,000 or 5% of appraised value up to $8,000 added to the mortgage for energy upgrades.
Are you a veteran? Then you get extra incentives for up to $6,000 added to the mortgage for energy upgrades.
For all energy efficient loan programs you only need to qualify only for the original loan amount – No additional credit qualifying is required
Our job is to help you find a suitable home, negotiate the best price and help to coordinate with your lender and contractors for all renovations after you close.
If you are considering selling your current home “Green,” you will get your renovation loan in place through our preferred lender. We will advise you on market values before and after the renovation to make the process profitable for you when you sell and close on your home. We can then list and market your home with the “Green” Designation, and your home will be valued at higher than it would have been prior to the renovations. Guaranteed, your home will be a very popular home and most likely will receive top dollar when sold. Staying in Arizona? Let us help you buy your next home using an Energy Efficient Mortgage and qualify for both the renovation and new purchase renovation tax credits available to you in Arizona.
Making the offer as a Buyer
The next step is to make a list of desired Energy Efficient improvements you would like your home to have. Do this prior to viewing homes with us so we can help you idenfity homes that will work for your energy efficient wants. For example, if you want your new home to have solar panels that you own, you don’t want to a home that already has a long term lease for solar panels because you will take on the lease for the rest of the lease term. Not ideal in any respect!
Once you have chosen a home, we will work with your lender to schedule a After we have found the home and prior to us writing an offer, we will work with the lender to set up a an Energy Audit/Analysis performed by a licensed Renovation-Energy Efficient Contractor.
This analysis will provide a score for Energy Efficiencies. The energy report takes what has to be done and then allows for your “Wish List” to be added. When we make the offer on your behalf, the offer will be for as is price, not including the costs of the renovations. With the help of us and your lender, we will provide you names of approved contractors to do the work you need for all your renovations, and those contractors will subsequently be contracted to perform the work immediately afer close of escrow.
Submitting the Offer
When writing the contract on your behalf, we will specify that you are obtaining a renovation loan; by giving the listing agent and seller advance notice because the offer will be contingent upon the Energy Audit results and so we can advise the seller of possible changes in inspection deadlines and will allow enough time to complete all inspections and gathering all estimates.. When obtaining a renovation loan, all work is done after a closing, so the closing time frame is similar to a typical transaction. Once closed, all renovations can begin and he title company we use and recommend will distribute the funds necessary to the contractors that have been hired to do the work. In many cases, all renovations can be completed within 30-60 days of close of escrow on your home.
The AZ Excellence Team provides full service residential real estate services throughout the entire state of Arizona.
Contact us today to learn more.
Patti Sampson – Team Leader