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What is the PowerSaver Grant from FHA?

What-is-the-PowerSaver-Grant-from-FHA.jpg*UPDATE: The PowerSaver Grant from HUD and FHA was discontinued in May 2015. But you can now take advantage of the AmeriFirst PowerSaver grant (more information here), and be sure to download our AmeriFirst PowerSaver Buyer's Guide for more detailed information.

What exactly is the PowerSaver Grant? How does it help home buyers and homeowners? Let's take a look. Many home buyers and current homeowners see “going green” as a great idea. Making your home more energy efficient is a terrific way to save money in the long run. However, it tends to cost money up front. Plus, how do you know you’re actually making a meaningful difference to your budget and the environment?

Download the AmeriFirst PowerSaver Buyer's Guide here and learn more!

A new option for home buyers looking to make some serious home improvements to their abode is the PowerSaver Grant from the U.S. Department of Housing (HUD) and FHA. PowerSaver is a federal grant through AmeriFirst Home Mortgage that pays home buyers’ closing costs when they make eligible home improvements, proven to be energy efficient upgrades.

Imagine it this way: You find a home you really like, as it’s in a great neighborhood with a lot of potential. However, the furnace is old, the windows are the old single-pane style with a few missing their storm windows and the water heater looks like it belongs in an antique store. If you take that house and finance it with the FHA 203k renovation loan, and make the upgrades to those items, you might be able to have AmeriFirst Home Mortgage pay your closing costs.

The total bill for the eligible upgrades has to add up to at least $3,500 and be rolled into the FHA 203k loan. Once you get to that point, the PowerSaver Grant can cover the 1% origination fee, the appraisal fee, the underwriting fee and an optional energy audit – up to $500. For the average buyer that should add up to about $2,000.

The benefits to you as the buyer begin to add up right away. Of course with Energy Star appliances like a water heater or furnace, you’ll see monthly savings on your utility bills. This will also happen when you perform window replacement with eligible Energy Star-rated windows, seal your duct work and other possible upgrades. Also, by financing this work into an FHA 203k, it’s one loan with low mortgage rates. Plus we pay your closing costs as mentioned above.

Those are the basics when it comes to the PowerSaver Grant. The video below answers the question with an interview with Renovation Lending Program Manager Joe Daly here at AmeriFirst Home Mortgage.

See the embedded video here - What is The PowerSaver Grant? 

PowerSaver is a grant from FHA that allows AmeriFirst to cover some closing costs when a buyer makes specific eco-friendly home improvements with FHA 203k.

The PowerSaver Grant helps home buyers and homeowners add energy efficient upgrades to their home, qualifying for a rebate of sorts - approximately $2,000 in closing costs paid by AmeriFirst Home Mortgage as "lender credits." The amount depends on the amount of the loan.

Eligible home improvements include:

  • Energy Star furnace
  • Energy Star air conditioner
  • Energy Star water heater
  • Duct sealing
  • Approved insulation
  • Approved window replacement
  • Storm window/door installation
  • Energy Star specified roof repair/replacement
  • Ground source heat pump
  • Sustainable energy upgrades like fuel cells, solar panels or wind turbine

Download the PowerSaver Grant Buyer's Guide

(creative commons photo credit)

*The post was originally published on November 7, 2013, and has since been updated for accuracy and comprehensiveness.

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5 Reasons Not to Skip Your Home Inspection

You found a house you love—hooray! But with lots of other buyers breathing down your neck, you feel like you need to act fast. To make your offer more attractive to the seller, you might be tempted to skip your home inspection, but here are five good reasons not to! 1.) Not all problems are obvious. It’s easy to spot issues like a crack in the sink or a broken light fixture. But do you know how to recognize foundation problems, termite infestations, outdated wiring, or sewer system problems? Trained home inspectors do and taking the time to have them go over the entire property before you sign the papers can prevent you from buying a headache instead of a home. BOTTOM LINE: The great thing about an inspection is that if you see major problems you’re unwilling to take on, you can change your mind and walk away. 2.) You may not be able to afford the repairs. If you’re like many new homeowners, you may not have much set aside to pay for needed repairs after saving up for your down payment and closing costs. While you may not mind waiting a bit to repaint or update appliances, waiting on problems like leaky roofs, broken plumbing, or infestations will only make them worse, and some issues, like broken furnaces, may need to be repaired right away. BOTTON LINE: You don’t want to go deep into debt to keep your home safe and comfortable. Instead, it’s worth negotiating with the seller to pay for repairs. If they refuse, you can simply walk away. 3. Some problems can make it harder to insure the home. Getting home insurance is essential because lenders need to see an insurance policy before you can close on your home—and of course, you’ll want to have your home protected in case anything goes wrong. However, some companies may decide that your home’s older electrical systems, plumbing, or building materials make it too risky to insure. BOTTON LINE: If essential updates are needed, the only choices are to ask the seller to pay for them, pay for them yourself if you can afford it, or walk away from the deal. 4. Serious issues can affect the resale value of the home. Your home is probably the biggest investment you will ever make. However, if it has major problems, instead of building your wealth, it could turn into a lousy investment that threatens your financial well-being. BOTTON LINE: While a home inspection typically costs a few hundred dollars, it’s an excellent investment in your peace of mind and financial health. 5. Some problems can threaten your family’s health or even your life. This sounds scary, but it’s no exaggeration. Issues like lead paint, black mold, radon (an odorless radioactive gas), or carbon monoxide leaks can cause serious and sometimes fatal health problems. BOTTON LINE: These issues are also easy to miss without a professional home inspection, and it’s simply not worth taking the risk. While it’s not easy to compete with other buyers who are bidding for the house you want, home inspections are one area where you don’t want to cut corners. To protect your physical, financial, and mental health, there’s no substitute for a professional home inspection.

6 Tips on How to Buy a House in Today's Market

Buying a home may be the American dream. But with escalating home prices, rising interest rates, low inventory, and inflation, as a first-time buyer, you may be wondering if that dream is out of reach.

Let's Talk FHA Loans

  If apartment living is getting old, or you've outgrown your parents' basement and house rules, you may be thinking about buying your own place. For this reason, you may be interested in learning about home loans that offer low and no-down payment options and have flexible lending requirements. One of these is the FHA loan. Let's take a closer look. 

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