Energy Efficiency Interest Rate Reduction (EEIRR)

To promote the energy efficiency of existing and newly constructed homes, Alaska Housing offers interest rate reductions to homebuyers for properties meeting certain criteria.

How the Energy Efficiency Rate Reduction Works

Alaska Housing offers interest rate reductions when financing new or existing energy-efficient homes or when borrowers make energy improvements to an existing home. Any property that can be energy-rated, and otherwise eligible for Alaska Housing financing, may qualify for this program.

Interest rate reductions apply to the first $200,000 of the loan amount. A loan amount exceeding $200,000 receives a blended interest rate rounded up to the next 0.125%. The percentage rate reduction depends on whether or not the property has access to natural gas.

Many things can be done to make a home more energy efficient. Some upgrades come in the form of renewables.  These bonus renewable points do not count in the calculation for the interest rate reduction.  Only the home’s energy rating and points count in the calculation for the interest rate reduction.  

NEW CONSTRUCTION

One of the following rate reductions may apply on newly constructed properties that exceed the minimum Alaska Building Energy Efficiency Standard (BEES). All homes constructed on or after July 1, 2013, must meet BEES 2012.

ACCESS TO NATURAL GAS NO ACCESS TO NATURAL GAS
  • 5 Star Plus Rating: -0.250%
  • 6 Star Rating: -0.375%
  • 5 Star Plus Rating: -0.375%
  • 6 Star Rating: -0.500%

EXISTING ENERGY-EFFICIENT PROPERTIES

Existing properties (completed for more than one year or previously occupied) may be eligible for one of the following rate reductions.

ACCESS TO NATURAL GAS NO ACCESS TO NATURAL GAS
  • 5 Star Plus Rating: -0.125%
  • 6 Star Rating: -0.250%
  • 5 Star Plus Rating: -0.250%
  • 6 Star Rating: -0.375%

EXISTING PROPERTIES WITH ENERGY IMPROVEMENTS

The lender must notify Alaska Housing at the time of application that the borrower intends to participate in the program. Within 365 days of loan closing the borrower must obtain an initial energy rating, complete the improvements, obtain the final energy rating and within 30 days of the final rating submit documentation to the loan servicer. To be eligible for a potential interest rate reduction, the home must increase at least one step and a minimum of 5 points.

Renewable bonus points do not count towards the minimum points needed, nor do they count towards points or steps for the interest rate reduction.  Only your home points count when determining the potential interest rate reduction. 

ACCESS TO NATURAL GAS NO ACCESS TO NATURAL GAS
  • 1 Step: -0.125%
  • 2 Steps: -0.250%
  • 3 Steps: -0.500%
  • 4 Steps: -0.625%
  • 1 Step: -0.250%
  • 2 Steps: -0.375%
  • 3 Steps: -0.625%
  • 4 Steps: -0.750%

Reference

How to Apply