It seems that Energy Efficient Mortgages (EEMs) are becoming very popular again. Buyers that have used the EEM option have been able to afford energy efficient upgrades in addition to the purchase of their homes. These upgrades include replacing drafty windows, adding insulation, replacing older heating & cooling systems, and home weatherizing.
As part of the program, the FHA EEM requires that the house be analyzed by a certified HERS Energy Rater before and after the upgrades have been made. The HERS Energy Rater measures and analyzes the home's characteristics and enters its data into an energy modeling software program. The software calculates the home's energy consumption and makes recommendations about which upgrades are most appropriate. The EEM loan is then used for the energy efficient upgrades, which make the home more affordable and more comfortable.
In one EEM HERS Rating that we did recently, the buyer was single mother of three small kids. She was buying her first home. It was an older 3 bedroom, 2 bath house with single pane aluminum windows next to a busy park. She knew that she wanted to upgrade the old windows but didn't know how to get it done, or how she could afford it. Her realtor suggested an EEM as the perfect solution. The recommended improvements for this house included new windows and heating & cooling duct leakage sealing. The lender closed escrow and then paid her $6,500.00 for all new dual pane vinyl windows and another $530.00 to get her duct system tested and sealed.
There are thousands of homes with single pane windows and leaky duct systems in California. The EEM is a perfect solution for improving the energy efficiency of those homes. To learn more about EEMs go to www.fha.gov. For more information on HERS Energy Ratings please contact us at 209-824-5356.