Getting Paid to Save with an Energy Efficient Mortgage

If you’re thinking of refinancing your home for remodeling, or you want to buy a house and fix it up, look into an energy-efficient mortgage (EEM) to cover the cost of upgrades. These mortgages let you roll the cost of the energy-related improvements into your home loan, even if you exceed traditional loan limits. Your mortgage payments will go up a little, but because your utility bills will also go down, you may even make a little money. As an example:

  The Murphy Family's
Traditional Mortgage    

The Gonzalez Family's
Energy Efficient Mortgage

Initial Loan $100,000 $100,000
Cost of Energy Improvements       N/A $4,000
Adjusted Loan Amount $100,000 $104,000
Monthly Mortgage Payment $880 $909
Monthly Utilities $126


Total Monthly Expenses $1,006 $980
Net Savings Per Year   $312

In this case, the Gonzalez family borrowed $4,000 more up front, but wound up saving $26 per month ($312 per year), and with a home that’s more comfortable and valuable than the Murphys.’