The Strategic Advantage of the HERE Model Solution
| What does this accomplish? | What are the advantages? |
| It creates significant motivation to additional market segments to promote energy retrofitting measures | These individuals are in a unique position to educate the public at the specific time when they can most strategically incorporate this opportunity to retrofit the energy related components of an existing house. It does this in a manner that overcomes all of the barriers that typically prevent retrofitting. |
| It solves multiple issues with the same incentive | This approach will not only create a huge demand for energy retrofitting measures, it will also provide a tremendous boost to the housing market and create far more jobs. Stabilizing housing prices is crucial on so many levels including the impact on revenues to Counties and Municipalities. |
| This will create far more jobs | Since this approach promotes an understanding of programs that allow very extensive energy retrofit packages to be financed at very favorable terms it will promote more comprehensive measures. Some of these options also allow items that are not energy related to be included which will create further opportunities for the Contractors involved. |
| These jobs will continue after the incentives are exhausted | These jobs will be sustainable since only the incentives are temporary. The only reason these programs are not utilized more extensively now is because they are not widely understood. This approach will create an understanding of these opportunities that will remain after the incentives are exhausted. The programs that are being used for financing and all of the other advantages will still be here when the funding has been exhausted. These strategies offer significant advantages without the incentives. |
| These options allow buyers to finance energy upgrades at very favorable terms | This increases the cost effectiveness from a cash flow perspective for consumers. Because the rate and terms are so favorable under this structure, the monthly utility savings will generally exceed the debt servicing for the energy retrofit measures. |
| They do not have to be limited by appraisal concerns | There are programs that will allow buyers to finance almost 15% of their sales price in energy upgrades without the appraisal having to be increased at all. This removes a common barrier to energy financing. |
| They do not have to be limited by qualifying concerns | Since one of the most advantageous energy financing structures that can be incorporated into purchase financing is not even factored in to the borrowers qualifying ratios, it is only the viability of the energy measures that needs to qualify. |
| The work is done after closing | This means that the buyer is the owner of the home when the energy retrofitting is done, allowing them to take advantage of the available incentives and rebates. |
| The best time to have these upgrades done is right after the home is purchased | One of the obstacles to energy retrofitting is the reluctance of some people to have their private and personal space violated. Some homeowners are very private and do not want Contractors or anyone else in their house. If the work is done right after the close of escrow, this is far less likely to be a barrier. In many of the transactions we have been involved in, the work was completed before the buyer even moved in, making this much easier for the Contractor. |
| The rebates act as a purchase incentive | When the Federal Homebuyer incentive was in effect, it was clear that it had a significant impact on housing sales. One of the primary reasons for this was that it allowed people to replenish their reserves right after purchasing which made them feel much more secure. By integrating energy retrofitting measures into their purchase process, this program allows potential buyers to achieve this same outcome. As a result, this will have a significant impact on housing sales once it is fully understood. In fact, when combined with some of the programs that are currently available, it can actually result in a higher level of monetization than the Federal Homebuyer Credit. |
| There is the benefit of a Realtor sales force | There are approximately 175,000 Realtors in the state of California. They are in desperate need of support in selling houses and stabilizing our housing market. That this can be accomplished in a way that also supports their efforts to promote the benefits of energy retrofitting, and the efforts that they have been making in that area for all these years, will result in a huge and incredibly motivated sales force for all of these utility provider, ARRA based programs, when incorporated into the HERE Model. |
| This also helps to sell houses | Conserving energy and retrofitting our existing housing stock is something that no-one would argue is an extremely important goal. Dealing with all of the issues associated with our declining housing values and vacant properties is also crucial to this state at the moment. An opportunity to apply a solution like the HERE Model offers, that addresses both issues by integrating the energy stimulus fund incentives into the purchase process in a way that stimulates home sales by incorporating energy retrofitting, creates an exponential benefit to everyone in the state of California. |
| You have trained professionals to help with the process | By including the Realtors and Loan Officers in this process, you are bringing in an element that typically has a very high trust relationship with the clients they serve. When they fully understand the process and benefits of the opportunities provided under these ARRA based energy retrofit incentive programs, and explain that to the consumers, it is going to have a very significant impact on the acceptance of these programs. When the EEM Facilitators are included in this process, you will be incorporating professionals who have extensive experience in explaining the benefits of energy retrofitting and making people feel very comfortable with this process. Ultimately, that is the primary function of their profession. |
| You promote programs that will continue well into the future | The HERE Model is based in supporting the incredible opportunities that have existed for years. Unfortunately, they are not fully understood. As a result, they arevery underutilized. One of the most strategic benefits of this approach is that it will result in a dynamic wherein every buyer will be offered the opportunity to take advantage of the programs that so few of us have fully understood. The result of this is, even without the incentives, it will become standard for buyers to incorporate energy retrofitting into their purchases just as my buyers have since 1993. |
| This is a much more strategic option than regulatory approaches | Although I realize that some people believe that Point of Sale mandated approaches are the answer to promoting energy retrofitting, I will hold that anything that offers significant advantages to the public does not have to be mandated. Reciprocally, anything that is mandated is immediately perceived as disadvantageous by the public. They don’t have to be forced to do things that they see as significantly beneficial to them. When there is an option like this approach that promotes innovation and excitement it is going to accomplish far more than regulatory steps could ever hope to accomplish |
| All of the components to make this work are HERE now | There were really only two things missing to make this approach an overwhelming success. One was the recognition of this incredible opportunity. The other was an adequate number of Loan Officers who were competent and knowledgeable in the specialty financing products that are needed here. To my knowledge there has never been a comprehensive training manual or resource created by a Loan Officer who actually has extensive experience and a practical understanding of how these programs really work. The training I have located that is being offered on these programs is inadequate and inaccurate. Even the training HUD themselves is offering contains flaws and inaccuracies. (Some examples of these inaccuracies are pointed out on the page I created titled “Current Dynamic.”) |
Sacramento 1st DBA Comstock Mortgage – Lic : 01390474
Kevin Nunn – NMLS 305826 / DRE 01158674
