Eco Mortgage

If you�re eco-minded and planning to get a mortgage, you can combine both interests with an eco mortgage. Definitions of what an eco mortgage is vary. According to Daily Green, the eco mortgage was pioneered by President Jimmy Carter when in 1979 he signed an executive order directing federally sponsored secondary market institutions to offer consumers incentives for energy-efficient homes. The idea was that a more energy efficient home has lower utility bills. Savings can be considered income, thus allowing a homebuyer to qualify for a bigger loan. An eco mortgage passes energy savings on to homeowners in the form of increased buying power. To apply for an eco mortgage, a Home Energy Rating System (HERS) report is required showing how your house meets all energy efficiency guidelines. The HERS Index is a scoring system established by the Residential Energy Services Network (RESNET) in which a home built to the specifications of the HERS Reference Home (based on the 2006 International Energy Conservation Code) scores a HERS Index of 100, while a net zero energy home scores a HERS Index of 0. The lower a home�s HERS Index, the more energy efficient it is in comparison to the HERS Reference Home. For those looking to decrease their energy usage by going green can hire a qualified professional to issue a HERS report with suggestions of efficiency improvements, their cost and the savings they will generate.

An eco mortgage can also be obtained from a lender who makes a commitment to offset their carbon footprint. In other cases the lender will donate towards the environment on behalf of the borrower. It depends on the company you�ll be dealing with and your specific circumstances. Brokers with firm ethical policies place tend to be the best options when looking for an eco mortgage.

The advantage in getting an eco mortgage based on energy efficiency is that your bills will be lower. Energy efficiency measures can be as simple as insulating your loft, thus preventing heat loss. Other alternatives include solar panels and thermopane windows. That would mean that both your money and the environment will be spared by taking the eco mortgage route.

The eco mortgage concept is still in its infancy and at present it is easier to be obtained for large-scale housing developments that incorporate "green building" construction where energy savings have been documented by engineers. However, eco mortgages will become more commonplace as they can play a significant role in society�s move towards a greener way of living, with reduced dependency on non-renewable energy sources.