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Eco-Mortgage Savings

energuide Being environmentally friendly can pay–even for mortgage shoppers. 

CMHC’s Energy Efficiency program is one example.

If you don’t have 20% to put down, you’ll typically need mortgage insurance. If you go through CMHC for that insurance, and buy an energy efficient home, CMHC will rebate you 10% of your mortgage insurance premiums.

An energy efficient home, according to CMHC, is one that:

  1. Is an energy-efficient R-2000 model;
  2. Has an EnerGuide energy efficiency rating of 77 or above (on or after July 27th, 20051);
  3. Was, or will be, built under a CMHC-eligible energy-efficient building program; or
  4. Is a condominium building that is 25% more energy efficient than if constructed to meet the requirements of the Model National Energy Code for Buildings (MNECB),

For energy efficient homeowners who need lower payments, CMHC will waive their premium surcharge on 40-year amortizations.  (Usually 40-year ams. entail insurance premiums that cost 0.60% of the mortgage value.)

These two savings can add up to real dough.  With a $250,000 mortgage, a homeowner getting 100% financing and a 40-year amortization could save:

    $775 in premiums + $1500 in 40-year amortization surcharge

This amounts to $2275, plus the interest saved by not rolling that amount into your mortgage (another $3677 over 40 years). 

That’s a nice chunk of green.