Peter Hoey

The latest stats show that remodeling is on the rise. Yet because credit is still tight, there are plenty of home­owners and home buyers who want to remodel and/or do energy upgrades but are unable to. One way they can is with 203(k) loans enhanced with Energy Efficiency Mortgage (EEM) features.

Give them What they Want

Educating clients about these loans helps them see that they can afford to remodel — for energy savings and for aesthetics. “Most people don’t wake up one morning and say they wish their home had less hourly air exchanges,” says Kerry Langley, director of sustainable and high-performance lending at Real Estate Mortgage Network (REMN). “But they do talk about wanting a better kitchen. Let’s give consumers what they want and while we’re at it, we’ll talk about improving energy efficiency.”

While thousands of lenders across the nation offer these loan products (see sidebar), Langley believes REMN may be the only lender pairing them.

Almost Anything Goes

To ensure that projects stay on track, REMN pays a remodeler directly. “If a remodeler has a $40,000 project, I have $40,000 plus 10% under my control before [he] starts,” Langley says. But there are limits to the types of projects covered.

You can’t install a “luxury item” such as a pool, “but you can repair an existing pool, and granite countertops are not considered a ‘luxury item,’” Langley says. These loans can help “transform anything into someone’s dream house.”

Stacey Freed, senior editor, REMODELING.