Amendment is Based on Bennet-Isakson SAVE Act
Washington, D.C. - Colorado U.S. Senator Michael Bennet (D-CO) introduced a bipartisan amendment with Senator Johnny Isakson (R-GA) based on their bill to establish more practical mortgage lending processes, encourage investments in energy-efficient homebuilding, and create tens of thousands of construction jobs. The amendment is based on the bipartisan Sensible Accounting to Value Energy (SAVE) Act that they've previously introduced.
"Energy expenses can be among the highest costs that come with homeownership. But with new materials, appliances, and other ways to maximize energy efficiency, it makes sense for our mortgages to reflect the value and savings they provide," Bennet said. "Our amendment will help ensure that borrowers with FHA-backed loans will be able to take into account the energy savings they'll realize when determining the size of their home loan. It offers commonsense incentives for the construction of energy efficient homes that will help create thousands of jobs along the way."
"The SAVE Act is essential to encourage homeowners to actually make the commitment to buy an energy-efficient home and get their investment back," said Gene Myers, CEO of Thrive Home Builders in Denver. "Until our customers can qualify for homes and receive the benefits of appraisals that reflect the true value of what they are buying, businesses like ours will be unable to really become the mainstream of housing in Colorado or anywhere across the country."
The SAVE Act would help establish more practical mortgage lending processes by allowing federal mortgage loan agencies to consider a home's energy efficiency and expected monthly energy bills when determining the homeowner's ability to afford monthly mortgage payments. On average, homeowners spend about $2,500 a year on home energy costs, and that adds up to more than $70,000 over the life of a 30-year mortgage. But, while mortgage lenders typically take into account the cost of real estate taxes and homeowner's insurance when determining the cost of a home loan, they do not take into account home energy costs, even though these costs are often more than taxes and insurance. The SAVE Act would address this blind spot, encouraging investments in energy-efficient homebuilding and creating tens of thousands of construction jobs in the process.
Click here to watch Sen. Bennet's floor speech on the amendment.