The Sensible Accounting and Value Energy Act (SAVE), according to the Institute for Market Transformations, may cause lenders to take the energy bills of borrowers into account before setting their mortgage rates.
The bill, co-sponsored by Senators Michael Bennett and Johnny Isakson, would have lenders for Fannie Mae, Freddie Mac and the Federal Housing Administration examining a borrower’s electricity and gas payments to determine if monthly mortgage payments could feasibly be made afterwards.
“The SAVE act would address this blind spot, giving a more complete picture of the costs of homeownership and borrowers’ capacity to service debt,” said a statement from the senators, reported in the Houston Real Estate Observer.
While the SAVE Act would be effective for homeowners nationally, Houston borrowers would especially benefit, as they are normally subject to higher energy costs particularly in the summer months. Each year, many homeowners end up spending more on electric bills than they do on either real estate taxes or home insurance. Thus, SAVE will make it possible for homeowners to upgrade energy plans as part of their mortgage.
Homeowners should keep in mind that, while SAVE has the potential to help out significantly with energy bills, energy costs can also be kept down by fixing leaks, installing insulation, upgrading A/C and utilizing solar energy, among other things.