Taking advantage of an Energy Efficient Mortgage (EEM) program doesn't have to be complicated when you have the help of an experienced EEM program manager such as Federal Energy Services. We take the guesswork and complexity out of the process and, from start to finish, manage your EEM application into an energy efficient home.
Step #1. Tell your lender that you want an Energy Efficient Mortgage (EEM) when you apply for your home loan. To take advantage of this program, you MUST contact Federal Energy Services before you have selected your loan and closed escrow.
Step #2. An HERS (Home Energy Rating System) auditor will visit your property and evaluate it thoroughly for current energy usage and potential energy efficiency upgrades that qualify under an EEM program. The HERS auditor is an independent third party, his or her fees (typically $300 to $350) paid out of escrow as an allowable closing cost. This ensures that the audit is conducted in a neutral and unbiased manner.
Step #3. The HERS auditor will then provide a report that profiles your property's current energy usage and outlines the relevant energy efficiency improvements that qualify under an EEM loan program. This report typically includes the installed costs of improvements, annual realized savings, and design life of energy-related upgrades known and proven to lower your monthly utility costs.
Step #4. Decide on the energy improvements that you want. We will prepare the necessary documentation for your loan file and forward it to your lender. The total cost of improving your property is then added to your mortgage, not to exceed the predictable monthly savings in your utility bill. EEM programs are designed to ensure a lower total monthly cost of ownership - the total cost of your energy improvements cannot exceed the estimated savings they will generate.
Qualifying improvements include (but are not limited to) : replacing/converting outdated furnace and AC units, installing vinyl-frame dual pane windows, upgrading or installing attic and wall insulation, upgrading water heaters and weatherizing doors, walls and pipe penetrations.
Step #5. As soon as the loan is closed, we will coordinate with you and the contractors to install your selected energy improvements. Unlike traditional home improvements that require 150% of estimated costs to be held in escrow, an EEM only requires 100% to be held. The improvement costs are held in escrow until the improvement work is complete.
Federal Energy Services manages the paperwork, coordinates with the lender and installation contractors, and works with you to ensure that you have the best EEM program for your situation. You are not charged any fee for our services - our fees are paid by the contractors with whom we maintain formal referral relationships.