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Energy efficient mortgages are available to those who wish to purchase a home that is considered to be energy efficient, or those who want to make energy efficient improvements to the home they are currently living in. In the United States, there are three different types of mortgages that are classed as being for purchase or making improvements to a home to make it more energy efficient.

The types of mortgages that are available are the conventional energy efficient mortgage (EEM), the FHA EEM and the VA EEM. Below we take a look at what these are and who can actually apply for one if they want.

The Conventional Energy Efficient Mortgage - This is most commonly used by those who are wishing to purchase a home that is currently considered to be energy efficient. Or they may use it to purchase a home and then make improvements that in turn will help to make it more energy efficient in the future. The amount that one borrows clearly shows just how effective the energy measures put in place are.

FHA EEM - These are specifically designed to allow people to make improvements to their homes and normally a person is able to borrow 100% of the costs of the energy efficient enhancements to be carried out. However, the maximum amount that one is able to borrow with this particular loan is $8,000, but the borrower is not required to make any down payment. People who have a home that is energy star qualified can apply for such a loan as it is sometimes also referred to as an energy star mortgage.

The VA Energy Efficient Mortgage - The only people who can apply for this type of loan are those who currently serve as military personnel, or who are classified as reservists or veterans. As with the FHA EEM, there is only a set sum of money that one can borrow in order to make improvements to a home. Currently the maximum amount that such people are able to borrow is $6,000.

There are numerous benefits to be gained from one taking out such mortgages or loans and below we look at a couple of these. As well as helping you to save on the costs of your utility bills each month, making such improvements to your home can actually increase its resale value as well.

The savings, which you make on the energy costs of your home, actually means that you are able to apply for a much larger sum of money to borrow. So what this means is that you may find that you are actually able to afford the kind of home for you and your family that you did not first think was possible.

The other benefit to be gained from taking out any kind of energy efficient mortgage is that should you wish to, you can include in your requirements the costs for making further improvements to it. This means that you can save yourself money by taking out one loan rather than several in the future. Also, you may well discover that you are presented with a far better rate of interest on your loan and so save yourself even more money.

Tags: Mortgages