Weatherization and new appliances can save energy costs.
But where do we find the up-front money?
We’ve had the home energy auditors in. They tell us that spending a few thousand dollars will save us a lot more than that over time. But where does a family find the money to invest in home energy improvements?
The savings can be big at today’s prices, and could be much bigger in the future as home energy costs rise. Heating oil is leading the way. Electricity prices jumped during the middle of the last decade, and are still trending up.
On the other hand, middle class incomes dropped through most of the last decade, and many of us are underemployed or worried about our job. Where are the thousands of dollars to upgrade our home going to come from?
Energy may be getting expensive, but money is cheap. Mortgage rates are still low (under 4% for a 15-year fixed-rate loan, under 5% for 30 years). And there’s a new type of mortgage that lets us borrow extra for energy improvements.
Only available on an initial or refinanced mortgage (not a second), the Energy Efficient Mortgage has the same disadvantage as most mortgages these days; banks are very conservative and are trying to lend only to borrowers who don’t need to borrow. Still, with good credit, this may be a good time for an EEM – particularly if inflation is coming. There are many sources of information on the web, including this example of how an EEM more than pays for itself from the start.