General DNR News

HOME LOAN PROGRAM OFFERS CASH-AT-CLOSING

A new program administered by the Louisiana Department of Natural Resources (DNR) offers financial incentives in the form of low-interest loans or actual cash payments for Louisiana residents who build new homes to high levels of energy efficiency or make energy improvements to existing homes at time of purchase or refinance.

DNR Secretary Jack Caldwell said the new program is called the Louisiana Home Energy Loan Program, or HELP for short. He said it is designed to encourage Louisiana citizens to make their homes more energy efficient, thus conserving energy and reducing pollution associated with energy production and use.

“Even without an incentive, investing in energy efficiency is almost always cost effective,” Caldwell said. “This program simply offers Louisiana citizens a financial incentive to do something that is already cost effective for them to do.”

Caldwell said that on average, each new home built or improved under the program will also save the home owner over $600 annually in energy costs and at the same time reduce carbon dioxide emissions by 7,300 pounds per year.

“You begin to see the tremendous potential of this program when you take into account that there are 1.4 million homes in Louisiana,” he concluded.

The HELP program will offer the homebuilder and home buyer two options: a reduced interest rate on a portion of the house loan or a one-time cash payment. Both the amount eligible for low-interest financing and the amount of the one-time cash payment are determined by a Home Energy Rating that must be performed on all houses participating in the program. The eligible amount is called the energy efficiency premium and will vary from house to house, based on their relative level of energy efficiency.

Under the first option, DNR will finance the energy efficiency premium portion of the house at two percent interest. The homeowner will then realize an interest and energy cost savings over the entire life of the home loan. On a typical house, option one of the HELP Program will result in an interest savings over the life of the loan ranging from $3,000 to $20,000. Depending on circumstances, this option can also reduce the required down payment and mortgage insurance premium.

The second option is called the HELP Cash-at-Closing Option. Under this option, the home buyer will actually receive cash from DNR at the loan closing. The cash payment will vary depending on the level of energy efficiency achieved. It can be used for any purpose, including helping to pay the down payment. On a typical home that meets the requirements for the HELP program, the cash at closing will be between $500 and $2,000.

Additional information on the Louisiana Home Energy Loan Program can be obtained at DNR’s toll-free HELP hotline at 1-800-836-9589. In Baton Rouge, call 342-3842.