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Consider an Energy-Efficient Mortgage
Would you sign up for a mortgage that qualifies you for a bigger loan with less income and makes the world a greener place? You might be able to through an energy-efficient mortgage, or EEM, the government loan granted to borrowers who build or upgrade their homes with energy-efficient features. The problem is most consumers either don’t know about the program, which has been around since the early 1990s, or they aren’t taking advantage of it. Enter the Obama administration. Hoping to push home buyers and owners to act greener, the president is funneling about $50 million to the Department of Housing and Urban Development (HUD) to jump start the EEM program. In December, he signed the fiscal year 2010 appropriations bill for a number of federal agencies, including HUD, the Department of Transportation and the Department of Labor – all devoted to clean energy efforts. What does the new funding mean for home buyers and owners? Not much detail has been released yet; HUD and the Department of Energy (DOE) are still determining how best to position this product so more people take advantage of it, a HUD spokesman says. One thing the department says it is aiming for is a more streamlined process of obtaining an energy-efficient mortgage – both financially and logistically. The existing program is perceived as complicated and inaccessible. Now, HUD and the DOE are trying to come up with an easier-to-access and less expensive model, says Michael Wolfe, executive director of Energy Programs Consortium, a nonprofit policy group, which is pilot testing an Energy Star mortgage program in several states. The Federal Housing Administration (FHA), Fannie Mae and the Department of Veterans Affairs all have some version of an energy-efficient mortgage. (There are some differences between the various loans, but the basic ideas are the same.) 3 Standout Energy Mutual Funds Mutual funds that invest in natural resources have more than $29 billion in assets, up from $7.2 billion five years ago. Here are three standouts: ICON Energy Fund (ICENX) Assets: $631 million Annual expenses: $116 per $10,000 5-year average annual return: 14.6% Computer programs help run the show at this “quantitative” fund, which rotates in and out of stocks based on measures of value and profitability. “It’s a highly structured environment,” says manager Derek Rollingson, who favors drillers and large oil and gas producers. Vanguard Energy (VGENX) Assets: $11.2 billion Annual expenses: $28 per $10,000 5-year average annual return: 13.3% This buy-and-hold fund focuses on large oil and gas firms and avoids riskier stocks. Manager Karl Bandtel holds stocks for five years, on average, and rock-bottom fees make it cheaper than even exchange traded funds tracking an energy index. Guinness Atkinson Global Energy (GAGEX) Assets: $83 million Annual Expenses: $131 per $10,000 Five Year Return: 17.3% Based in London, this small go-anywhere fund has beaten 99% of peers over the last five years. Co-managers Tim Guinness and Jim Atkinson have free reign to span the globe, including emerging markets, and favor the multinational oil producers these days for their improving margins, says Guinness. More Energy Information from The Dept. of Energy and Energy Star Free Homeowner Estimates Nationwide - |