HomeStyle Energy Mortgage Fact Sheet
Whether they’re purchasing a home or refinancing their current one, borrowers can now make upgrades to reduce utility costs and improve the comfort and safety of their homes with Fannie Mae’s HomeStyle® Energy mortgage.
Features
Flexible
May be used for upgrades to energy and water systems including solar, property improvements for better resilience to natural disasters, new windows and doors, and to pay off other energy-related debt.
Affordable
Borrowers save money now with possible tax credits and rebates, potentially lower interest rates compared to other forms of financing, and save on utility and repair costs in the future.
Simple
Basic weatherization, renewable energy and resiliency upgrades and improvements do not require a home energy report.
Bundle mortgage products for more flexibility and savings
Both HomeStyle Renovation and HomeStyle Energy mortgages may be combined with a HomeReady® mortgage, so your low-income borrowers can take advantage of the following features:
- Low down payment and cancellable mortgage insurance (restrictions apply)
- Potentially lower rates compared with other forms of financing such as home equity line of credit or credit cards
- Get a $500 loan level pricing adjustment (LLPA) credit, on top of standard Fannie Mae pricing
Simplified and expanded eligibility for HomeStyle Energy for purchase and refinance transactions
Maximum LTV (1-unit owner-occupied)
- Up to 97% (See Fannie Mae’s Eligibility Matrix for specific details based on the loan transaction)
Financing energy-related improvements
- Up to 15% of “as completed” appraised property value
Occupancy and property eligibility
- All one- to four-unit existing properties
- Manufactured housing, provided no structural changes
- All occupancy types permitted
Covers improvements to the home’s resiliency to natural disasters
Upgrades include:
- Storm surge barriers
- Foundation retrofitting for earthquakes
- Hazardous brush and tree removal in fire zones
- Retaining walls to address mud or water flows
Radon remediation
- Covers installation, no energy report required
Energy report waivers available
No energy report required for:
- ENERGY STAR®- certified products
- Basic weatherization and water efficient items up to $3,500
- Water efficiency devices
- Renewable energy sources including solar panels, wind power devices, geothermal systems
- Environmental hazard damage repairs or resiliency improvements
Can be used to pay off other energy- related financing
- Entire PACE lien amounts (with purchase or refinance)
- Financing for prior-energy related improvements: up to 15% of property value (with refinance)
Maximum DTI ratio
- Per Desktop Underwriter®, or 45% for manually underwritten loans
- May go to maximum of 38% DTI if DOE Home Energy Report scores 6 or higher (when requirements for 45% DTI are not met)
