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Energy mortgages are essentially mortgages that credit a home’s energy efficiency in the home loan.

For an already energy efficient home, this could allow the borrower a greater debt-to-income ratio, thereby giving the homebuyer the ability to buy a higher quality home due to lower monthly heating and cooling costs. For homes where energy efficiency can be improved, an energy mortgage allows money saved in monthly utility bills to finance energy improvements.

A variety of energy mortgages have appeared in recent years and more are anticipated as RESNET and the Environmental Protection Agency increase education and information outreach.


Energy mortgages basically fall into 2 main categories: energy efficient mortgages (EEM) and energy improvement mortgages (EIM).

The best way to finance the purchase of an energy efficient home or energy-saving retrofits to an existing home, is with an energy mortgage.

Fannie Mae, Freddie Mac, the Federal Housing Administration (FHA) and the U.S. Department of Veterans Affairs (VA) all offer special underwriting guidelines for energy mortgages. These guidelines can cover anything from how the costs of energy efficient improvements are worked into a loan to the allowable maximum mortgage limits.

Did you know that an energy efficient mortgage (EEM) can be used for both purchase and refinance transactions? Or that an energy rating is required for qualification for an energy mortgage?