With home energy bills on the rise across the nation, lenders are offering homeowners financing to upgrade their homes.

Long-term, low-interest mortgages and loans are popping up from both government and private lenders for homeowners who want to improve their homes’ energy efficiency. Borrowers can even arrang for 30-year loans with interest rates under 10%.

For example, homeowners who wish to purchase a home that needs energy upgrades — such as new appliances and heating — can add an additional $35,000 to their mortgage using a FHA program.

The program is aimed at several home improvement projects, including new roofing, plumbing or upgrades in energy efficiency. Everything from new doors and windows to added insulation is included in the program, according to the agency.

The FHA’s Streamline K loan program offers a 30-year mortgage, fixed or adjustable. The average loan amount for improvements ranges between $18,000 and $20,000.

The program offers a way to “bring today’s energy technology to yesterday’s houses,” says Doris Ikle, president of CMC Energy Services.

“When people are buying a house…they want at this point to reduce their bills. Yet, buyers often have no money left for improvements once they close on a mortgage,” she said.

There are also several private lenders offering loans for upgrades in energy efficiency. Many states have programs that give added incentive.

When looking to purchase a home with energy improvements financed, you will have to have an energy audit performed on the home. However, the extra steps at closing can often save you a lot of time and money in the long run.
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