Retrofitting homes to make them energy-efficient is a great way of saving money in the long run, but it can be expensive in the here and now. Fortunately, homeowners who want to upgrade their energy efficiency can do it without emptying their bank accounts. Through Homeowner Funding, many different grants and programs for roof, window, and insulation financing, as well as much, much more.
The cost of energy-efficient upgrades becomes more manageable with unsecured loan programs that allow homeowners to finance their homes and upgrades. These unsecured loans can be lines of credit or personal loans.
With an energy-efficiency loan for existing homes, homeowners do not need to use their homes as collateral. While lenders do offer energy-efficient mortgages, these personal loans are popular for people who do not want to refinance with an expensive mortgage. However, an energy-efficiency loan does not have a tax-deductible interest program.
While mortgage originators require time before they approve borrowers, lenders can immediately approve customers who want an energy-efficiency loan. Borrowers who default on the unsecured loans will see their credit scores drop as collection agencies will come after payment.
Energy-efficiency financing gives homeowners the power to fund large projects.
- Installing new insulation
- Replacement roof funding
- Adding an energy-efficient HVAC system
- Installing efficient windows
- Placing solar panels
- Putting in a cool or green roof
Lenders do not give loans for small projects like replacing lighting or installing a new refrigerator.
Another option for homebuyers is an energy-efficient home mortgage, which helps people buy a new or existing home as well as refinance or remodel to add upgraded systems. Energy-efficient mortgages let buyers afford more expensive homes because buyers have lower energy costs in their new homes.
Conventional lenders and government agencies offer energy-efficient mortgages. Buyers can investigate the programs through their state offices. The loans exist for buyers who want to make their new homes more energy-efficient or purchase existing energy-efficient homes.
Determining an Energy-Efficient Home
Before buyers can qualify for an energy-efficient loan, the lenders need to know the home’s energy rating. The pre-qualification process involves hiring a professional energy rater to assign a value between 0 and 150, with the lowest scores showing the most energy efficiency.
The rater will look closely at features like the HVAC system, window and door efficiency, insulation, air leaks, and water usage. They can also make recommendations for upgrades to reduce each home’s rating. Most raters also craft reports that include estimated energy costs and the savings from the existing features and the recommended upgrades.
To qualify for the energy-efficient mortgage with low-interest rates, the homebuyer must show that the home has energy-efficient features. If the home doesn’t have enough features, the homebuyer has to show how the improvements reduce energy costs to cover the additional mortgage expense.
If the lender sees that the energy costs are low, the homebuyer gets the benefit of an increased debt-to-income ratio to buy the more expensive home.
When homebuyers want to make their lives more energy-efficient, they can turn to several other financial programs.
Tax Credits and Savings
The federal government and some states offer tax credits for upgrading a home’s energy efficiency. The government offers tax credits for everything from installing a charger for an electric car to adding solar panels to the roof.
In some cases, the savings come from utility companies that want homeowners to turn to renewable energy. They reward consumers with outstanding rebates when they add eco-friendly upgrades to their homes.
Designing an Energy-Efficient Home
Homeowners who want to upgrade their existing homes or build a new one can turn to professional home designers who specialize in energy efficiency. In a pre-existing home, they evaluate the energy efficiency to figure out how to cut costs. With new home builds, the consultants help include energy-efficient systems.
Home designers look at everything from energy-efficient framing that uses less wood to alternative home designs using hay bales or earth shelters. They also look at other alternatives like cool roofs, passive solar heating, and eco-friendly paint and flooring.
Homebuyers can also look closely at the entire home and the parts that affect the whole. Architects and energy experts analyze how the conditions of the building site affect the design to decrease energy expenses and create a healthy home. This process can be costly, which is why having access to an energy-efficient mortgage with low-interest rates matters.
Designers look at the local climate, daylighting, heating, and cooling, as well as air sealing and insulation to craft a home that benefits from a whole-house, eco-friendly system. With thoughtful, environmentally-conscious whole-house designs, homes are more durable and comfortable because they complement the climate rather than withstand it.
Homebuyers have several tools at their disposal to create and pay for an energy-efficient home.
Homeowner Funding Helps Finance Energy-Efficient Homes
Roof replacements. Solar panels. Window funding. Loans. Grants. Tax credits.
With all the different options available to those looking to make their homes more energy-efficient it can be hard deciding which possibilities are the best, the most cost-effective, and the most appropriate for your property. Homeowner Funding can help you make the right decision for you and your loved ones.
Contact us today for more information.