Embracing Energy-Efficient Mortgages in Pennsylvania
In an era where environmental consciousness meets financial savvy, energy-efficient mortgages (EEMs) have emerged as a great alternative for Pennsylvania homeowners aspiring to both reduce their carbon footprint and save money.
What Are Energy-Efficient Mortgages?
Energy-efficient mortgages are designed to finance the purchase of a home and include the costs of energy-efficient upgrades in the loan without requiring a larger down payment. Essentially, EEMs acknowledge the savings from reduced utility expenses, allowing borrowers to allocate more of their income toward their mortgage payment (thus allowing them to afford “more home”).
Who Qualifies for an Energy-Efficient Mortgage?
Qualifying for an EEM in Pennsylvania is accessible to a broad range of homebuyers and homeowners, including first-time and current homebuyers purchasing new or existing properties. Also, current homeowners who are interested in refinancing and incorporating energy-efficient upgrades can also take advantage of EEM’s. Your eligibility typically hinges on the projected energy savings from the planned improvements and the borrower's creditworthiness and income stability.
Some Examples of Energy-Efficient Upgrades Worth Considering
Per the US Department of Energy and other sources, here are some average savings with various upgrades that you may see (everyone’s home energy needs are different):
Insulation and Air Sealing. According to the U.S. Department of Energy, adding insulation and sealing air leaks can save homeowners up to 15% on heating and cooling costs, or an average of 11% on total energy costs. For a typical home, this could mean savings of about $200 annually!
Energy-Efficient HVAC Systems. Replacing an old heating, ventilation, and air conditioning (HVAC) system with a more energy-efficient model can save homeowners between 20% to 40% on their annual heating and cooling bills. For example, upgrading from a SEER 10 to a SEER 20 air conditioning unit can save approximately $300 per year in cooling costs for an average-sized home.
LED Lighting. LED bulbs use at least 75% less energy and last 25 times longer than incandescent lighting. Switching to LED lighting can save an average household about $225 per year in energy costs!
Energy-Efficient Windows. Replacing single-pane windows with ENERGY STAR-rated double-pane windows can save between $126 to $465 a year for a typical home, depending on the geographic location.
Solar Panels. The average solar panel system can save homeowners roughly $1,200 per year on electricity bills. Over the 25 to 30-year lifespan of a solar panel system, this amounts to savings of $30,000 to $36,000.
Smart Thermostats. A study by Nest found that on average, a smart thermostat can save 10% to 12% on heating and 15% on cooling, amounting to about $131 to $145 in savings each year. They also can be very convenient when it comes to changing your home’s temperature no matter where you are.
Water-Saving Fixtures. Low-flow water fixtures can reduce water bills by 25% to 60%, according to the Environmental Protection Agency (EPA). For an average family, this can translate to savings of more than $100 per year.
The Easiest Energy Efficiency Upgrade: LED Lights
LED (Light Emitting Diode) lights are a superior choice for energy efficiency and cost savings due to several key factors, but mainly their higher energy efficiency. LED lights convert a higher percentage of electricity into light, with efficiencies up to 90% better than traditional incandescent bulbs. This means less energy is wasted as heat and more is used for illumination, leading to lower electricity consumption.
LEDs also have a much longer lifespan compared to incandescent and compact fluorescent lights (CFLs). The combination of lower energy consumption and a longer lifespan means that while LED lights may have a higher initial purchase price, they cost less to operate over their lifetime. This results in significant savings on electricity bills and replacement costs.
Energy-efficient mortgages offer Pennsylvania residents a path to make their homes more eco-friendly while reaping the financial benefits of lower utility bills. Implementing energy-saving tips at home further enhances these benefits, making your home a model of efficiency and sustainability. For more information on securing an EEM and making your home energy-efficient, consult with a knowledgeable mortgage professional in Pennsylvania who specializes in green financing options.
