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Inspection will provide tips for improvement that you can utilize to help lower your bills
By Ken Sheinkopf
McClatchy-Tribune News Service
Published on Saturday, Apr 05, 2008
Q: Mortgages are always in the news these days, but I never read anything about the energy-efficient mortgages you have been talking about for a long time. Are they still around?
A: I don't read about them too often, either, but they're still out there and they're still something every home buyer should consider.
The secret is to find a lender who offers them, something that may take a little effort but can pay off big-time. Talk to people at banks in your area, check with mortgage brokers and do a little Internet searching and you'll find lenders who have this type of financing for home buyers, sellers, or even people wanting to remodel their current homes. Buyers will enjoy lower utility costs while sellers of efficient homes have an extra marketing advantage over less-efficient homes.
An energy-efficient mortgage is based on recognition that lower monthly utility bills mean more money in your pocket, money you can use to pay a bigger mortgage on a home that might be better than you could afford without the utility savings.
The basis of an energy-efficient mortgage is a home inspection by an energy rater, who will put together a detailed report on the home's efficiency, documenting how it will save energy. An added benefit is that these audits also identify potential areas of savings (such as adding insulation or upgrading windows) that you might consider pursuing.
Once you've had the rating completed, be sure to tell prospective lenders up-front that you want an energy-efficient mortgage. You'll find that you can often put the cost of additional energy improvements right into the home's mortgage, greatly lowering monthly payments on new features or remodeling.
While many people make energy improvements to their homes, the biggest benefit of putting these improvements into the mortgage when you buy the home is that you usually start saving from your first day in the house. Spreading the cost of energy improvements over the life of the mortgage generally means a modest increase in the mortgage but energy savings that exceed that higher payment.
By factoring in the money you'll save by lowering utility bills, mortgage companies can give you a higher debt-to-income ratio in your application. This can mean you now qualify for a house that costs more than you could afford without that savings, meaning a bigger home with energy savings offsetting the higher cost over a lower-priced one.
Aside from the economic benefits, energy-efficient homes also mean more comfortable homes, usually with less outdoor air, noise and insects getting inside. Getting rid of drafty areas, ''hot spots'' and other problems often found in homes that are not efficient mean you'll enjoy your home even more.
By the way, this type of mortgage really is nothing new. It's been 16 years since Congress established a pilot program for this type of mortgage in five states, and expanded it nationally three years later. Since that time, tens of thousands of homeowners have gotten one of these mortgages. And as energy costs continue to go up, the utility savings become even greater.
I've heard from a number of people who were able to buy their first home because the energy-efficient mortgage allowed them to qualify for something they could afford. I even saw some information attributed to the Environmental Protection Agency that more than 6 percent more families would be able to get home financing if they had an energy-efficient mortgage.
Q: Mortgages are always in the news these days, but I never read anything about the energy-efficient mortgages you have been talking about for a long time. Are they still around?
Get the full article here.
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Posted 05:02 AM, 01/09/2009
I don’t think attending the Consumer Electronics Show in Las Vegas is the smartest move I could ever make at least for right now. The show, like the economy, is shrinking. And salespeople are looking to generate more than interest this year – they are looking to generate profit. I know I’m short on extra cash so it may be best to stay away. However, if you have somehow managed to stay ahead financially, with or without a payday loan, some of the items that will be featured this year might help keep you ahead. This year’s convention will spotlight items such as Netbooks, which are light-weight, low-cost, and energy-efficient. Amid the recession, this may be one of the best things to invest in. Although these energy-efficient technologies can help people save money, you’re going to have to spend some money first. So who knows? Maybe getting a payday loan for this event may not be such a bad idea.
