How To Fund A Greener House

The drive for greener lifestyles has hit every consumer product. From clothing to organic food, consumers are trying to support a more ecologically friendly lifestyle. For individuals who are trying to update their home, there are several green funding options on the market that can assist in paying for home updates and energy efficient appliances.

Energy Efficient Mortgages

One of the latest energy efficient funding options is the energy efficient mortgage. When a homeowner adds green features to their home, the additional efficiency is credited to their mortgage. This means that individuals can qualify for larger loans and stretch out their debt-to-income ratio. Typically, these mortgages are given to a home that is already energy efficient. They are often outfitted with Energy Star appliances or are certified by Energy Star.

Known as Energy Improvement Mortgages (EIM), these financing options are used to purchase existing homes. The money that the homeowner saves on energy bills can then be used to finance new improvements. Energy Efficient Mortgages and Energy Improvement mortgages both require a home energy rating. This rating allows the lender to calculate the Energy Savings Value. Often, these mortgages are sponsored by federally insured mortgage programs. They can also be found with some traditional lenders.

VA Energy Efficient Mortgages

Military veterans are in luck. The Veteran’s Administration has ensured that former military service is rewarded with an additional mortgage option. When veterans make energy improvements, they can increase their mortgage by several thousand dollars. To qualify, veterans should ask their lender about different options when they begin the application for a mortgage. They can also contact Veteran’s Affairs or visit their website for more information.

Government Grants

Homeowners have several different options for pursuing government grants. They can visit the US Department of Energy, the US Department of Housing and Urban Development or the US Department of Housing and Urban Development. Veterans can also check out funding options available through the Veterans’ Affairs Agency. Many of the funding options are available people based on their income, age or disability status. To check out these green funding options, individuals should visit

Tax Credits

Although this money is not available until after the home is updated, it can still make the cost less burdensome for the homeowner. Currently, tax payers can write off up to 30 percent of labor and installation costs on their income tax return. If they purchase equipment or construction materials, they can claim up to $1,500 as an income tax credit. In addition to federal taxes, some local and state governments also offer credits for energy efficient updates. In the state of Washington, homeowners can be paid for up to $5,000 of electricity produced by their solar panels. Homeowners in California can deduct the entire cost of creating a solar panel system.

Utility Companies

Utility companies have the unenvied task of supplying enough power for peak usage while still trying to cut costs. In an attempt to lower their operating expenses, some utility companies will actually provide grants to their customers to add energy efficient appliances or solar panels. They may purchase the extra electricity or give the homeowner a grant for weatherizing their home. Since this varies from company to company, homeowners should visit the website of the utility company in their area.

Home Depot Foundation

The Home Depot Foundation is a nonprofit that works to increase the standard of living for moderate or low income families. They provide funding to these families that covers the cost of energy efficient improvements. Other nonprofits often will provide the same funding options. Individuals interested in green updates should check with the United Way or with their local housing organization.

No matter what their budget is, homeowners can find green funding options. These funding programs are run by different groups ranging from the United States government to non-profit entities. With all of the options out there, it has never been easier to make a house more energy efficient.

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