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What is an Energy Efficient Mortgage (Green Mortgage)?

Are you looking to buy a home or upgrade your current property in Johnson City, TN, while lowering your utility bills? An Energy Efficient Mortgage, also known as a Green Mortgage, might be the perfect solution. This specialized loan allows borrowers to finance the cost of energy-saving improvements directly into their primary mortgage. Whether you are adding solar panels, upgrading to a high-efficiency HVAC system, or installing better insulation, an energy efficient mortgage makes sustainable living more affordable.

At The Arrowood Team, led by Tim Arrowood at Preferred Rate, we specialize in helping East Tennessee residents navigate these unique loan programs. We are experts at providing second opinions on energy-efficient mortgages to ensure you are getting the best terms possible for your financial goals.

Types of Energy Efficient Mortgages: FHA, VA, and Conventional Options

Understanding the different types of Green Mortgages is crucial for finding the right fit for your home. Here is a comprehensive look at the three main programs available to buyers and homeowners in Johnson City:

  • FHA EEM: Backed by the Federal Housing Administration, an FHA EEM allows you to add energy improvements to your FHA purchase loan or refinance. The amount you can finance is typically based on the energy evaluation report and does not require an additional down payment.
  • VA EEM: Available to eligible veterans and active-duty military, the VA EEM permits borrowers to add up to a specific dollar amount for energy efficiency improvements when purchasing or refinancing a home.
  • Conventional EEM: For those with stronger credit profiles, conventional lenders offer green financing options. You can easily bundle home upgrades into a conventional fixed-rate mortgage, often increasing your purchasing power because lenders factor in the projected utility savings.

If you have already received a quote for one of these programs, let us take a look. We are experts at providing second opinions on energy-efficient mortgages and can help you verify if your current offer is truly the most competitive option.

Types of Energy Efficient Mortgages: FHA, VA, and Conventional Options
Loan TypeWho It Is ForMax Energy Package FinancingSpecial Requirements
FHA EEMFirst-time buyers and those with lower credit scoresUp to 5% of property value (subject to limits)Requires a Home Energy Assessment
VA EEMEligible Veterans and Military PersonnelUp to $6,000 without a separate appraisalMust demonstrate that improvements reduce utility costs
Conventional EEMBorrowers with good to excellent creditUp to 15% of the appraised valueEnergy savings must exceed the cost of improvements

Why Choose The Arrowood Team for Your Green Mortgage Needs

Securing an energy efficient mortgage requires working with a lender who understands the intricacies of green financing. Tim Arrowood and The Arrowood Team at Preferred Rate are dedicated to serving the Johnson City community with transparent, reliable mortgage advice. We know exactly how to structure an FHA EEM, VA EEM, or Conventional EEM to maximize your investment.

Never settle for the first offer you receive. Because we are experts at providing second opinions on energy-efficient mortgages, we can review your current loan estimate and identify potential savings or better structuring options. Upgrading your home to be eco-friendly should save you money, and your mortgage should do the same. Contact us today at 1-423-406-1567 or email tim.arrowood@preferredrate.com to discuss your options.

Q1: What qualifies as an energy efficient upgrade for a Green Mortgage?

Eligible upgrades typically include solar water heaters, high-efficiency HVAC systems, double-pane windows, weather stripping, and enhanced insulation. The specific improvements must be proven to save energy.

Q2: Do I need a special energy assessment?

Yes, most energy efficient mortgage programs require a Home Energy Rating System (HERS) report or a similar energy assessment by a qualified professional to determine the cost-effectiveness of the planned upgrades.

Q3: Can I use an EEM to refinance my current home in Johnson City?

Absolutely. You can use an energy efficient mortgage for both purchasing a new home and refinancing your existing home to pay for energy-saving improvements.

Q4: How does an FHA EEM differ from a standard FHA loan?

An FHA EEM functions like a standard FHA loan but includes extra funds specifically designated for energy improvements. The best part is that these additional funds do not require a larger down payment.

Q5: Are you able to provide a second opinion on my current EEM quote?

Yes! We highly recommend getting a second opinion. The Arrowood Team specializes in reviewing energy-efficient mortgage offers to ensure you are getting the most favorable rates and terms available.Get Your Free EEM Second Opinion Today

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equal housing opportunity NMLS CONSUMER ACCESS LINK: NMLS #1850

© 2024 American Pacific Mortgage Corporation. For informational purposes only. No guarantee of accuracy is expressed or implied. Programs shown may not include all options or pricing structures. Rates, terms, programs and underwriting policies subject to change without notice. This is not an offer to extend credit or a commitment to lend. All loans subject to underwriting approval. Some products may not be available in all states and restrictions may apply. Equal Housing Opportunity.

Refinancing may result in finance charges that may be higher over the life of the loan. Consult with your loan advisor for details.

Not available in New York. Licensed as Preferred Rate in AL, AZ, CA, CO, FL, GA, IL, IN, KS, KY, LA, MA, MD, MI, MO, MS, NC, OK, OR, TN, TX, VA, WA, and WI. Preferred Rate operates under American Pacific Mortgage in NV. AZ BK 1014819. CA #01215943. Regulated by the Colorado Division of Real Estate. Georgia Residential Mortgage Licensee. NV MB 164. Licensed under the Oregon Consumer Finance Act. OK MLO13426.

Licensed by the Illinois Department of Financial & Professional Regulation, Residential Mortgage License # MB.6761304 | James R. Thompson Center | IDPR – 555 West Monroe Street, 5th Floor Chicago, IL 60661 | (888) 473-4858

Licensed by the Dept of Financial Protection and Innovation under the CRMLA.

The Department of Financial and Professional Regulation (Department) evaluates our performance in meeting the financial services needs of this community, including the needs of low-income to moderate-income households. The Department takes this evaluation into account when deciding on certain applications submitted by us for approval by the Department. Your involvement is encouraged. You may obtain a copy of our evaluation. You may also submit signed, written comments about our performance in meeting community financial services needs to the Department.” (Source: P.A. 101-657, eff. 3-23-21.)

CONSUMERS WISHING TO FILE A COMPLAINT AGAINST A COMPANY OR A RESIDENTIAL MORTGAGE LOAN ORIGINATOR SHOULD COMPLETE AND SEND A COMPLAINT FORM TO THE TEXAS DEPARTMENT OF SAVINGS AND MORTGAGE LENDING, 2601 NORTH LAMAR, SUITE 201, AUSTIN, TEXAS 78705. COMPLAINT FORMS AND INSTRUCTIONS MAY BE OBTAINED FROM THE DEPARTMENT’S WEBSITE AT WWW.SML.TEXAS.GOV. A TOLL-FREE CONSUMER HOTLINE IS AVAILABLE AT 1-877-276-5550. THE DEPARTMENT MAINTAINS A RECOVERY FUND TO MAKE PAYMENTS OF CERTAIN ACTUAL OUT OF POCKET DAMAGES SUSTAINED BY BORROWERS CAUSED BY ACTS OF LICENSED RESIDENTIALMORTGAGE LOAN ORIGINATORS. A WRITTEN APPLICATION FOR REIMBURSEMENT FROM THE RECOVERY FUND MUST BE FILED WITH AND INVESTIGATED BY THE DEPARTMENT PRIOR TO THE PAYMENT OF A CLAIM. FOR MORE INFORMATION ABOUT THE RECOVERY FUND, PLEASE CONSULT THE DEPARTMENT’S WEBSITE AT WWW.SML.TEXAS.GOV.”

THE DEPARTMENT MAINTAINS A RECOVERY FUND TO MAKE PAYMENTS OF CERTAIN ACTUAL OUT OF POCKET DAMAGES SUSTAINED BY BORROWERS CAUSED BY ACTS OF LICENSED RESIDENTIALMORTGAGE LOAN ORIGINATORS. A WRITTEN APPLICATION FOR REIMBURSEMENT FROM THE RECOVERY FUND MUST BE FILED WITH AND INVESTIGATED BY THE DEPARTMENT PRIOR TO THE PAYMENT OF A CLAIM. FOR MORE INFORMATION ABOUT THE RECOVERY FUND, PLEASE CONSULT THE DEPARTMENT’S WEBSITE AT WWW.SML.TEXAS.GOV