Energy efficient mortgages (“EEMs”) have been around for over thirty years, but remain underutilized and under marketed despite the momentum of the green building movement. EEMs are mortgages that allow borrowers to buy more house or reduce interest rates because of the future cost savings and increased value associated with efficient homes. The general theory is that the owner of an energy efficient home will spend less on utilities than the average homeowner, so the energy efficient homeowner will be able to afford more home than traditional mortgage calculators allow.
The Florida Solar Energy Center maintains a database of Energy Efficient Mortgage providers. After an EEM product is identified, the borrower obtains an energy rating pursuant to the Florida Building Energy-Efficiency Rating Act. Section 553.990, Florida Statutes. The Act, much like the EEM, is nothing new–it went into effect over fifteen years ago ”to provide for a statewide uniform system for rating the energy efficiency of buildings.” Section 553.990, Florida Statutes. As part of this Home Energy Rating System (HERS), certified building raters grade the efficiency of homes for EEMs. For more information on the HERS, visit The Florida Solar Energy Center.
So why haven’t green mortgages kept up with the momentum of the green building movement? At least one article blames lack of borrower demand, increased paperwork for the loan processor and poor marketing by lenders and real estate agents.
Submitted by Desiree Noisette, LEED AP, Hill Ward Henderson, 101 E. Kennedy Blvd, Suite 3700, Tampa, Florida 33602, dnoisette@hwhlaw.com, (813) 222-8722.
Filed under: Volume 1, Issue 1: June 2009
