Energy Efficient Mortgages (EEM)

What is an Energy Efficient Mortgage (EEM)?

An Energy Efficient Mortgage (EEM) is a mortgage that credits energy efficient features and performance of the home.

It is easy to use, federally recognized, and can be applied to most home mortgages.

EEMs give borrowers the opportunity to finance cost-effective, energy-saving measures as part of a single mortgage.
This allows borrowers to qualify for a higher loan amount and a better, more energy-efficient home.

By allowing borrowers to pay for energy improvements easily through your mortgage, your lender can increase your loan to cover energy improvement costs. Monthly mortgage payments increase slightly, but you can actually save money because your energy bills will be lower.

Who Benefits from an Energy Efficiency Mortgage (EEM)?

Buyers

Qualify for a larger loan on a better home

Get a more comfortable home NOW

Save money every month from Day One

Increase the potential resale value of your home

Sellers

Sell your home more quickly

Make your house affordable to more people

Attract attention in a competitive market

Remodelers

Get all the EEM benefits without moving

Make improvements which will actually save you money

Increase the potential resale value of your home

For more information, visit HUD Energy Efficient Mortgage (EEM) Homeowner Guide

What Type of Energy Efficient Mortgages (EEM) Are Available?

There are several types of EEMs and each have different rules based on the type of loan you get.

Conventional Energy Efficiency Mortgage
Conventional EEMs increase the purchasing power of buying an energy efficient home by allowing the lender to increase the borrower’s income by a dollar amount equal to the estimated energy savings.
Discuss this directly with your lender to find out more.
To find a lender in your area, please visit the ENERGY STAR Partner Locator.

Federal Housing Authority (FHA) Energy Efficiency Mortgage
The mortgage loan amount for an FHA EEM can be increased by the cost of effective energy improvements.

Veterans Administration (VA) Energy Efficient Mortgage
The Veteran’s Administration (VA) EEM is available to qualified military personnel, reservists and veterans for energy improvements when purchasing an existing home. The VA EEM caps energy improvements at $3,000–$6,000. Borrowers should ask their lender about a VA EEM at the beginning of the lending process. More information about VA EEMs can be obtained from the website for the U.S. Department of Veteran’s Affairs or by calling (800) 827-1000.

Energy Efficient Mortgages

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