Your mortgage may not be higher than 100% of the value of your house these days. Yet there are exceptions. For example, with planned renovations that increase your home value, you can still borrow more. This is also the case with energy-saving measures. With the real estate for sale in Hilton Head Island SC you can expect the best now.
Loan to Value
Let’s start from the beginning. The bank can grant you a certain mortgage based on your income. An income test is done to determine this amount. The amount that comes out is called the loan-to-income (LTI). In addition, you may not borrow more than the house is worth, 100% of the value. This is called loan-to-value (LTV). Do you want to buy a house and are you planning to make it more energy efficient? Then you may be able to borrow up to 106% of the value of your house. Has the property you purchased been assessed before 1 January 2015 as an energy-efficient home with an A ++ label (or higher)? Even then you can borrow 106% of the market value.
You cannot simply borrow these extra amounts. The condition is that the money is spent on energy-saving facilities (EBV). These are facilities that make a house more energy efficient. EBV includes, for example, an HR boiler, a heat pump or solar cells. Click here to see which additional services are charged as EBV.
If you want to borrow more than your LTV, with the plan to provide your home with energy-saving facilities, you will unfortunately not get this money deposited into your bank account. To check whether the extra money actually goes to EBV, your lender makes a home construction account. You can see the building fund account as a jar of money that the bank is holding back until you can show that you have spent it well. Once you have built a new energy-saving facility in your home, you can send an invoice to the bank. They check whether the amount is correct and whether it has actually been spent on energy-saving measures. If everything is correct you will get back the money that you have spent.
Loan to Income
Also on your LTI there is the possibility to borrow more than banks in the first instance often say. You are allowed to borrow an additional 9,000 dollars on top of what you can borrow based on your income if you want to make your house more fuel-efficient or if it is already economical. If you buy an energy-neutral home, you are even allowed to borrow an additional 25,000 dollars on top of your LTI. An energy-neutral home is a home that generates all energy consumed by the building itself. The extra loan amounts are calculated based on your energy expenditure. It is actually very simple. The more energy efficient a house is, the lower your electricity costs. The amount that is normally spent on the energy bill can, in the case of energy-efficient or energy-neutral homes, be spent on the house itself.
The government has made agreements about reducing energy consumption. Not only in this Country, but throughout the world, energy consumption must be reduced in order to achieve the agreed climate targets.