Originating & Underwriting

HomeStyle Energy

On September 16, Fannie Mae launched a new education course called HomeStyle® Mortgages Unlocked. Take this course to learn more about how to originate, sell, and service both HomeStyle Renovation and HomeStyle Energy mortgages. Click here to get started.

 

Brighten your borrowers’ homeownership journey

From solar panel installation to air sealing, HomeStyle® Energy provides flexible financing for energy-related improvements as part of a purchase or refinance mortgage.

With more options, borrowers can upgrade outdated homes in their budget, make updates that reduce monthly utility costs, and enhance the overall comfort and safety of their homes.

More Ways for Borrowers to Save on Home Improvements

This new search tool can help homebuyers find local programs that can offset costs for energy, water, and resiliency improvements. 

More ways to power up

bulb and drop

Energy and Water Updates

air sealing, heating and cooling, plumbing

recycle

Renewable Energy

solar panels, geothermal systems, wind power devices

house air flow

Home Resiliency

storm surge barriers, foundation retrofitting, natural disaster repairs

See the possibilities of HomeStyle Energy

Flexible

HomeStyle Energy can finance a wide range of energy-efficient updates, including renewable energy installation, resiliency and weatherization upgrades, and even paying off existing energy-related debt like Property Assessed Clean Energy (PACE) loans.

Affordable

Upgrading the energy efficiency of older homes may help reduce utility costs and qualify your borrowers for potential tax credits and rebates. Plus, HomeStyle Energy loans qualify lenders for a $500 Loan Level Price Adjustment (LLPA) credit.

Simple

Without needing to acquire a home energy report, your borrowers can finance basic weatherization (up to $3,500), renewable energy, and resiliency updates.

Details that help conserve time and energy

Unlike HomeStyle Renovation, HomeStyle Energy doesn’t require special approval. It’s already available for use by any Fannie Mae lender.

  • Maximum LTV up to 97%
  • Can finance the loan amount up to 15% of the as-completed appraised property value.
  • To qualify for purchase loans with an LTV greater than 95%, homeownership education will be required for at least one borrower when all occupying borrowers are first-time homebuyers. Fannie Mae HomeView® can be used to satisfy this requirement. Learn more about homeownership education.
  • Certain HomeStyle Energy updates require a qualified assessor to complete an energy report. See our list of eligible energy improvements that don’t require an energy report.
  • Improvements must be in compliance with local zoning and building codes. 

See Fannie Mae’s Eligibility Matrix for specific product details based on the loan transaction.

Combine HomeStyle Energy with other Fannie Mae products to offer borrowers benefits like more flexibility and savings:

HomeStyle Renovation: Use both HomeStyle loans together to maintain benefits like a $500 LLPA credit and energy report waiver on ENERGY STAR®-certified improvements while funding additional projects that go beyond energy efficiency.

HomeReady®: Our low down payment mortgage has lower rates and cancellable mortgage insurance (restrictions apply). Combine this mortgage with HomeStyle Energy to make financing upgrade projects even more affordable.

Note: HomeStyle Energy loans may qualify for an LLPA waiver for Duty to Serve. See Duty to Serve eligibility requirements for details.

Answers to frequently asked questions about HomeStyle Energy

The borrower or lender may either visit the DOE Home Energy Score website or the HERS website to locate a local qualified energy assessor. Additionally, there may be a local or state home energy certification or audit program available to provide a report comparable to the DOE Home Energy Score or HERS report. In such cases, the energy report can be completed by an independent home energy consultant or auditor certified by such a local or state program. Refer to Selling Guide section B5-3.3-01 for further details.

If the borrower is paying off a PACE loan, documentation must be provided showing that the funds are solely being used to pay off the PACE loan obtained for improvements on the subject property. A payoff statement from the PACE program is sufficient to document the outstanding balance to be paid off.

If the payoff is for other secured or unsecured debt that was used to finance energy-related improvements, the borrower must provide copies of invoices or receipts documenting the cost of the related expenses.

No. Consumers may only refinance debt, including home equity loans, PACE financing, or other debt used for energy improvements.

What about financing for general home improvement projects?

A HomeStyle Renovation loan covers an array of repairs, updates, and upgrades, giving your borrowers more options to personalize their home.

Explore HomeStyle Renovation

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