How SIPs and Energy-Efficient Financing Upgrade Your Home

Turns out SIPs not only save money in energy costs, they also help you afford a nicer home! According to an article about financing energy-efficient homes on the U.S. Department of Energy’s website, an energy-efficient mortgage (EEM) can help you qualify for a more expensive home.

How does it work? To verify energy savings, EEM lenders consider the HERS rating from a home energy audit. The smaller the number on your HERS report the better—and homes built with Thermocore structural insulated panels consistently score lower on the HERS index. For instance, Bart Rynish of Barton Designs achieved a HERS rating of 35 with Thermocore SIPs, saving the homeowner hundreds of dollars per year on heating bills.

Lenders figure the less you spend on utility bills, the more you can afford for mortgage payments when you build, remodel, or refinance. Not only will you enjoy the comfortable temperatures, quiet, and sturdiness of your Thermocore SIPs home, you’ll relax in upgraded livings spaces thanks to energy-efficient financing.

How Will Adding HERS Scores to the MLS Affect the Housing Market?

This is a great question posed in a recent news article. There has been a national push to include Home Energy Rating System (HERS) Index scores in real estate listings (often referred to as the Multiple Listing Service, or MLS). In essence, a home’s energy performance will be included along with the number of bedrooms and bathrooms. That’s the equivalent of putting the yellow ENERGY STAR rating sheet, commonly seen on appliances, onto your home.

Why is this important? Energy costs directly affect your monthly cash flow and your ability to pay your mortgage. Knowing these costs and how they compare to other homes in the area helps identify the best deal and allows homeowners to budget all their expenses.

Most importantly, the HERS rating will help recoup the money you spend on energy-efficient construction. Items like LED lighting and energy-efficient appliances have no effect; a HERS rating only reflects heating and cooling expenses—the major costs in home ownership. Unlike other eye-candy types of upgrades, investments in energy-efficient construction can now be measured and shown as an asset to a home’s value.

The easiest and most cost-effective way to improve a home’s HERS rating—and increase resale value—is to lower energy demand. Of course, one of the easiest and most cost-effective ways to lower demand is to build with structural insulated panels (SIPs) like Thermocore.

Mortgage Risk Shrinks with Energy-Efficient Buildings

So it’s not just me. Jen Alic, a blogger for The Christian Science Monitor, says, “Here’s some new impetus for those sitting on the fence over household energy efficiency: The risk of mortgage default is one-third lower for people with energy-efficient homes, according to a recent study.”

The research by the University of North Carolina’s Center for Community Capital provides the first real academic link between mortgages and energy efficiency, but it proves my favorite point: SIPs and other smart energy-saving features just make your financial situation better.

In the study, houses with lower HERS scores showed a lower mortgage-default risk. After all, when you save hundreds of dollars on energy costs each month, it becomes much easier to make your mortgage payments—and still have money for other priorities.

Homes built with Thermocore structural insulated panels consistently score lower on the HERS index. A normal HERS rating is 100; the Energy Star standard is 70. Bart Rynish of Barton Designs achieved a HERS rating of 35 with Thermocore SIPs. After Art Smith of Rocky Ridge Designs received a HERS rating of 67, he found that his SIPs home actually consumed less than half the predicted amount of energy in its first year.

Despite what some may say, building with structural insulated panels does not cost more than traditional building methods. There are so many reasons to build green. Now we have proof that using SIPs and other energy-efficient features also protects your mortgage.