The HUD Energy-Efficient Mortgage Or EEM

[Dominick Penny]

In 1992, Congress mandated a pilot demonstration of Energy Efficient
Mortgages (EEMs) in five states. Because of the program's success, in
1995 the pilot was expanded as a national program.
EEMs recognize that reduced utility expenses can permit a homeowner to
pay a higher mortgage to cover the cost of the energy improvements on
top of the approved mortgage. FHA EEMs provide mortgage insurance for
a person to purchase or refinance a principal, owner-occupied
residence and incorporate the cost of energy efficient improvements
into the mortgage. The borrower does not have to qualify for the
additional money and does not make a down payment on it! The mortgage
loan is funded by a lending institution, such as a mortgage company,
bank, or savings and loan association, and the mortgage is insured by
HUD. FHA insures loans. FHA does not provide loans.
ELIGIBILITY REQUIREMENTS:
- The approved borrower(s) need 3.5% equity or down payment in an
owner-occupied property.
- Eligible properties are one to four unit existing and new
construction.
- The cost of the energy efficient improvements that may be eligible
for financing into the mortgage is the greater of 5 percent of the
property's value (not to exceed $8,000), or $4,000.
- To be eligible for inclusion in this mortgage, the energy efficient
improvements must be cost effective, meaning that the total cost of
the improvements is less than the total present value of the energy
saved over the useful life of the energy improvement.
- The cost of the energy improvements and estimate of the energy
savings must be determined by a home energy rating report (or "HERS"),
which is done by a home energy rating system or energy consultant. The
cost of the energy rating may be financed as part of the cost
effective energy package. Normally,an official from your local utility
company will conduct the HERS.
- The energy improvements are installed after the loan closes. The
lender will place the money in an escrow account. The money will be
released to the borrower after an inspection verifies that the
improvements are installed and the energy savings will be achieved.
This program works very well with the HUD/FHA 203(k) Home Improvement
loan as well.
- The maximum mortgage limit for a single family unit depends on its
location and it is adjusted annually. The cost of the eligible energy
efficient improvements is added to the mortgage amount. The final loan
amount can exceed the maximum mortgage limit by the amount of the
energy efficient improvements.
In summary, "going green" can be easy as pie and well worth the
applications and underwriting, so long as your situation is handled by
an adept team of professionals who understand the procedures and
guidelines!

Secret For Generating Free Electricity: http://www.homeenergymi.tk/