What are Energy Efficient Mortgages?

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  • Written By: Mary McMahon
  • Edited By: Bronwyn Harris
  • Last Modified Date: 11 February 2020
  • Copyright Protected:
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Energy efficient mortgages, also known as EEMs, are designed to encourage people to purchase energy efficient homes and to remodel their existing homes. There are a number of different types of energy efficient mortgages, some of which are supported by government agencies which are designed to promote home ownership among low income individuals and veterans. When buying or remodeling a house, an energy efficient mortgage is definitely something to think about, especially if you are thinking of making energy improvements anyway.

The logic behind an energy efficient mortgage is that an energy efficient home is cheaper to run and maintain than one which is not efficient, but modifying a home to be more efficient can be expensive. These mortgages make additional funds available to homeowners and purchasers to help them install energy efficiency tools like better insulation, low energy appliances, solar panels, and so forth. By helping people make their homes more efficient, these mortgages also help regions meet their energy efficiency goals.

For consumers, there are several benefits to energy efficient mortgages. In the first place, they make homes which are more expensive because of energy improvements affordable. They also reduce the overall ownership costs of a home by lowering energy bills, sometimes quite dramatically. As a result, though monthly mortgage payments may be a bit high, the house costs less per month than a less efficient home, as the energy improvements provide a savings.


There are several ways in which energy efficient mortgages can work. In some cases, people can apply for such a mortgage to finance modifications to an existing home. In other instances, homeowners may make energy efficient modifications to a home before selling it to make the home eligible for an energy efficient mortgage, and potentially thereby making the home more appealing to buyers. For buyers, the mortgage can help finance the purchase of an energy efficient home, or it can provide financial assistance to modify a home after it has been purchased.

If you are considering an energy efficient mortgage, the local bank is a good place to start. The bank can provide information about which energy efficient mortgages you qualify for, and for people in certain circumstances, assistance from government agencies may be available as well. When you are thinking about energy modifications and a potential mortgage, try to obtain energy bills for the home from the past, to get an idea of how much you could potentially save.



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