Green Mortgages Can Save You Cash

What is a Green Mortgage?

If you’re in the market for a home, or if you own a home, you should check into the new green mortgages being offered by mortgage companies. Green mortgages are the latest way to make your home more energy efficient without digging into your savings account or charging up your credit cards.

Simply put, a green mortgage provides the home buyer with extra funds to decrease a home’s energy consumption. This will increase the mortgage payments by a small amount, but the savings on utility bills will be large enough to offset the larger  mortgage payments. A home owner will enjoy a healthy profit each month because of the lower energy consumption.

Green mortgages can be fixed or adjustable rate. A green mortgage can also be a second mortgage that is meant solely for the improvement of the home’s energy efficiency.

What Types of Home Improvements Qualify for a Green Mortgage?

Basically, any improvements that are Energy Star rated qualify for a green mortgage. However these restrictions apply:

• The improvements must meet the United States Environmental Protection Agency guidelines.
• The improvements must improve the home’s energy efficiency by 15 percent more than the 2004 International Residential Code.
• The improvements must make the home 20 to 30 percent more energy efficient than comparable homes.
• The improvements must be certified by a third-party Home Energy Rating System authority.

Solar panels, residential wind turbines, ceiling insulation, double-paned windows and furnace duct insulation all qualify for a green mortgage.

How Much Can you Save with a Green Mortgage?

Naturally, the size of the home and the amount of improvements will determine how much can be saved with a green mortgage. A home in the $200,000 range with an extra $10,000 added to the mortgage for improvements can result in a monthly increase of about $60 to the mortgage payments. The reduced utility bills can mean a savings of $100 per month. That adds up to $1200 per year. Additionally, there are Federal and State tax incentives to entice you to go ahead and make the improvements. Even local energy suppliers have rebate programs to encourage green upgrades to existing homes.

As you look for ways to reduce your monthly bills, don’t overlook a green mortgage or second mortgage. Not only will you save money, you’ll be doing your part to preserve the local environment.

So, have you ever tried a green mortgage? What did you like and not like about it?

Guest Post Author Bio: This post was provided by Dylan Clegg, a head writer from a leading financial resource.


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