Beat the Heat with a New Mortgage
If you plan on buying a new home or refinancing, you may
want to consider checking out an Energy Efficient Mortgage
(EEM). Wkrc.com, a television news affiliate in Cincinnati,
released an article on July 18, 2006, “A
Mortgage That Helps You Save on Energy Bills” that
explains what these EEMs are.
“The simple explanation is you take on a bigger mortgage
than you might normally qualify for. You don't have to be
building a million dollar house to get some of the new high
efficiency appliances. And we all could use the energy savings.”
The EEM allows you to purchase energy efficient appliances,
designed to help lower electricity bills, through your mortgage.
There are different EEMs offered with conventional and governmental
loan programs. You may have to have your mortgage
lender find one for you since they are fairly new and
difficult to find, but they are out there.
"One adds two percent to the debt ratio, and the other
adds to your savings. What you will save from improvements
goes into your income, which is nice it helps you qualify
for a bigger mortgage," mortgage advisor Donna Swartwout
said.
The EEM is valuable because it not only saves you money on
heating and cooling each month, it also increases your home
value if you decide to sell.
“EEM's can be for anyone buying or refinancing. ‘From
low income to jumbo loans the very high dollar mortgages,’”
Swartwout said.
“Many improvements qualify ... and some of these same
items also qualify for tax credits ... whether you do an EEM
or not. You don't have to do the improvements before the loan
closes. In fact they way it works you set the money aside
in a type of escrow account.”
Since the EEM is a new concept, make sure you research terms
and stipulations before qualifying for one. There are many
ways to qualify and many improvements your home could use.
An EEM allows you to save money while also increasing the
value of your home. You will have to take out a bigger
mortgage, but you will be rewarded in the end.
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