WASHINGTON — If you buy or own an energy-efficient house, does this make you less likely to default on your mortgage? Is there a connection between the monthly savings on utility costs and the probability that you’ll pay your loan on time?
A new study by the University of North Carolina suggests that the answer to both questions is a resounding yes.
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Using a sample of 71,000 home loans from across the country that were originated between 2002 and 2012, researchers found that mortgages on homes with Energy Star certifications were on average 32% less likely to default compared with loans on homes with no energy-efficiency improvements. Energy Star homes, which can be renovated dwellings or newly built, provide documentable savings of 15% or higher on utility bills compared with houses containing minimal energy improvements.
Researchers took pains to statistically separate out factors other than energy-efficiency savings that might account for the strikingly different performances by borrowers on their mortgages. They controlled for house size; age of the house; neighborhood income levels; house values relative to the area median; local unemployment rates; borrowers’ credit scores; loan-to-value ratios; electricity costs; and even local weather conditions.
Read more at: http://articles.latimes.com/2013/mar/29/business/la-fi-harney-20130331
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