Energy Efficient Mortgage (EEM)

In my last post, I wrote about the FHA 203(k) program where one loan includes purchase funds plus renovation funds.

Homebuyers/homeowners can also benefit from a green financing option called an Energy Efficient Mortgage (EEM). In fact, an EEM is just one green financing option available for residential and commercial buyers and sellers.

An Energy Efficient Mortgage allows the homebuyer/homeowner to roll the cost of the needed energy improvements into the mortgage, amortizing the cost of the improvements over the life of the mortgage. So,not only do you get to finance the energy improvements, you also increase your buying power!

The FHA guidelines include:

1. Energy-efficient improvement costs of $4,000 or 5% of the property value up to $8,000, whichever is greater.

2. The FHA maximum mortgage limit for an area may be exceeded by the cost of the improvements.

3. No additional down payment is required.

4. The EEM can be used in conjunction with the FHA 203(k) program.

An inspection from a professional, who has been certified under an accredited Home Energy Rating System (HERS), is required.

You can apply for an EEM through a government-insured or conventional loan program. Check with your State energy office to see if there is any type of program for residents.

Please share your thoughts by leaving a comment or calling me, toll-free, at 1-800-231-0622.

For more information on Mammoth Lakes real estate, please log onto my real estate website at


Consumer and Lender Resources for Energy Efficiency Financing and Home Energy Ratings

Alliance to Save Energy


“Energy Efficient Mortgage Home Owner Guide”

United States Department of Energy

Office of Building Technology, State and Community Programs


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