2.5% Energy Efficient Home Mortgage Loan from Nebraska Energy Office

Posted Jan 3, 2012 | 0 Comment(s) | Filed in: Construction

The Nebraska Energy Office is offering 2.5% Dollar and Energy Saving Loans through eligible Nebraska lenders for the construction of single family, detached dwellings located in Nebraska which will be built as ENERGY STAR®, Five Star Plus homes with a HERS Rating score of 50 or less. You must supply the Energy Office with a set of the construction drawings and specifications showing inclusion of all required products, dimensions, R-values, efficiencies, mechanical design, etc., along with the Home Energy Rating System (HERS) reports, from plans, which show the home meets the Energy Efficient Housing Loan Program requirements, and shows the program inputs used by the HERS rater and Heating, Ventilation, and Air Conditioning (HVAC) sizing (a copy of the Building File Report and Equipment Sizing Summary). Once the Energy Office has this information, it will be reviewed for compliance with the requirements of the program and you will be notified that either (a) the plan complies and you may apply for a loan from an eligible Nebraska lender, or (b) the plan is deficient in specific areas and you have the opportunity to revise and resubmit the information. If your plan complies with program requirements, the Energy Office must be notified by your Nebraska lender that your application for a construction loan has been approved by their institution and receive your loan application paperwork from the lender. Once a Commitment Agreement between your lender and the Energy Office has been signed, the lender will notify you that you may begin construction. You may not begin construction prior to receiving notification from your lender that the Energy Office has committed funds to your project. Construction is considered to start when any permanent structure is placed on top of the footings. During and after construction the HERS rater will need to inspect the home to insure construction is completed according to the plans and ENERGY STAR®, Five Star Plus requirements with a HERS Rating score of 50 or less, and provide the Energy Office with the associated completed checklists and final HERS rating.

The construction loan must be secured by a 1st mortgage on the home being constructed; have a permanent loan take-out commitment in place; not be written for more than 1 year; carry an interest rate of no more than 2.5%; and be covered in full by property insurance. Any loan fees charged by the lender will be only for costs associated with the loan paid to a non-affiliated third party or, if in-house fees, not exceed the lender's published fees for like extensions of credit.

The construction loan can include the costs of the lot, Home Energy Rating, design and plans, material and equipment to be installed in the house, building permits, utility installation or connection, general contractor, subcontractors and wages paid to employees, as well as loan fees charged by the lender. The costs of services by the borrower and the borrower's family or friends who are not actual employees or contractors engaged in the construction business are not eligible.

Lender may loan 100% of the total cost of the project up to the appraised value of the home as completed or $417,000.00, whichever is less, provided the lender determines the borrower has sufficient resources, or can provide additional collateral, to cover any amount over and above the permanent loan take-out commitment.

Source:  Nebraska Energy Office