Green lending is back, thanks to record-low interest rates and other factors that allow borrowers to retain more loan proceeds and enjoy lower payments. In addition, the early response to COVID-19 interrupted the flow of commercial loans, leaving Fannie Mae and Freddie Mac behind on their respective $100 billion lending caps for 2020. The combination of ample funds available at low rates has created a hot multifamily market, particularly for affordable housing projects, which often have a green component.
As the market leader in multifamily financing and green financing, Fannie Mae has made great strides to incentivize borrowers and owners to invest in strategic, green, and sustainable property improvements via its Green Rewards Program. Although their Green Rewards program isn’t new, in the past the focus was primarily on energy and water efficiency improvements. However, one of the most effective ways to reach full energy efficiency as required is to install a solar system on the property. Although these systems can be expensive, they can turn great rewards into savings to ownership and potentially tenants – and the low interest rates along with the green lending programs help make solar a reality. As an added bonus, Fannie Mae recently created a new incentive to their program to help with their push to invest in solar, which is starting to attract interest.
The Green Rewards program already offers several benefits to the borrower, such as lower interest rates, up to 5% more loan proceeds, and free Energy and Water Audit Reports. Now, Fannie Mae has expanded the program to include a free Technical Solar Assessment (TSA) of the property for those who are interested and approved to go Solar.
The following GlobeSt article by Partner breaks down everything you need to know about the Technical Solar Assessment and the benefits of working with consultants familiar with navigating the Fannie Mae due diligence landscape. Click here to read more.
