With Fannie Mae's HomeStyle Energy mortgage, borrowers can finance up to 15% of a home's "as completed" appraised value for energy efficiency improvements by receiving a Home Energy Score.
• Borrowers in this program can also qualify for a stretch on their debt-to-income ratios for homes that score a 6 or higher, or for making improvements to a less efficient home.
• The Federal Housing Administration (FHA) has a similar policy that allows larger debt-to-income ratios for high scoring homes.
• These policies reflect the fact that more efficient homes have lower operating costs.
• Colorado is going a step further as the first to tie financial incentives directly to the Home
Energy Score.
• To sweeten the deal at time of purchase or refinance, Colorado is offering $750 for every one-point improvement a borrower makes on the Home Energy Score, up to $3,000 for a four point jump in Score.
• The state hopes these financial incentives will attract more borrowers who are interested in making improvements they otherwise couldn’t afford or might overlook.