Energy Efficient Mortgage Loans Offered as Add-On to VA and FHA Loan Products in Hawaii

Everybody is talking about energy efficiency these days, and especially with Hawaii’s high energy costs, it’s important to think green.

Green Mortgages

There is a small loan that has been around for years but rarely utilized. It’s called the EEM (Energy Efficient Mortgage). It is available as an add-on to VA and FHA loan products for home purchases and refinances.

It allows a borrower to get an additional 5% of the home price (capped at $8,000 for FHA and $6,000 for VA loans) to finance energy efficient improvements.

The additional debt incurred in your monthly payment is excluded from your qualifying ratios. The logic is that what will be saved in electric costs will be more than the increase in the mortgage payment.

What Kind of Energy Efficient Improvements Could be Included?

• Replacement windows
• Increased insulation
• Solar panels
• Energy saving appliances