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Stylized Text: Home Energy Ratings.

Financing Energy Efficiency: An EEM Handbook


Section 305 -Energy Efficient Properties

Fannie Mae
Selling Part VII Property and A
3 - Special Appraisal Consideration
305 - Energy Efficient Properties 
Pg 731 - 732

When a lender is giving special underwriting consideration to a borrower because the property that secures his or her mortgage is energy efficient, the lender can use either of two methods to qualify the dwelling as energy-efficient: development of an energy-efficiency rating by the appraiser or an energy consultant or reliance on the construction of the dwelling having been in compliance with qualifying energy conservation programs or the builder's certification that it has complied with the Council of American Building Officials Model Energy Code.

Regardless of the method used for qualifying a dwelling as "energy efficient," the appraiser must consider the reaction of the market to energy-efficient improvements (or proposed alterations) and reflect their contributory value in the "sales comparison analysis" based on the appraiser's analysis of comparable properties. However, if adequate comparables are not available, the appraiser may develop an analysis of the present worth of the estimated savings in utility costs. To do this, the appraiser may use a procedure that is similar to the one used in Part II of the Energy Addendum (Form 1004A).

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