Chapter 4

Green Mortgage Loans

Section 401	Generally

401.01	Description

Requirements

A Green Mortgage LoanGreen Mortgage LoanMortgage Loan secured by a Property that incorporates features expected to have a positive environmental outcome including, but not limited to, reducing energy and water consumption at a Property, generating energy, or meeting criteria set by a third-party green building certification organization… is secured by a PropertyPropertyMultifamily residential property securing the Mortgage Loan and including the land (or Leasehold interest in land), Improvements, and personal property (as defined in the Uniform Commercial Code). that incorporates features expected to have a positive environmental outcome including, but not limited to, reducing energy and water consumption at a property, generating energy, or meeting criteria set by a third-party green building certification organization.

A Green Rewards Mortgage LoanGreen Rewards Mortgage LoanMortgage Loan secured by a Property on which the Borrower agrees to undertake 1 or more Energy- and Water-Efficiency Measures (Efficiency Measures or EWEM) that comply with Part III: Products and Features, Section 403. is secured by a PropertyPropertyMultifamily residential property securing the Mortgage Loan and including the land (or Leasehold interest in land), Improvements, and personal property (as defined in the Uniform Commercial Code). on which the BorrowerBorrowerPerson who is the obligor under the Note. agrees to undertake 1 or more Energy- and Water-Efficiency Measures (Efficiency Measures or EWEM) that comply with Part III, Chapter 4: Green Mortgage Loans, Section 403: Green Rewards Mortgage Loans.

401.02	High Performance Building Module

Requirements

retain a consultant to provide either:
- a High Performance Building (HPB) module (HPB ModuleHPB ModulePCA High Performance Building Module assessing cost effective opportunities to increase a Property’s energy and water efficiency and reduce costs. ), including Appendix H: HPB Module Report Tables (Form 4099.H), as part of a required PCAPCAAssessment of the current physical condition and historical operation of the Property. ; or
- a standalone HPBHPBHigh Performance Building report (HPB Report), including Form 4099.H; and
complete the HPB ModuleHPB ModulePCA High Performance Building Module assessing cost effective opportunities to increase a Property’s energy and water efficiency and reduce costs. or HPB Report and Form 4099.H per the requirements of Form 4099.

Guidance

Notwithstanding the prohibition in Part IV A, Chapter 2: Pricing, Origination Fees, and Prepayment Premium Incentives, Section 202.01: Origination Fee regarding a LenderLenderPerson approved by Fannie Mae to sell or service Mortgage Loans. paying third-party costs, you may use the Origination FeeOrigination FeeFee charged by the Lender to the Borrower for underwriting and originating the Mortgage Loan, per Part IV A: Mortgage Loan Commitment, Delivery and Purchase Procedures, Section 202. to reimburse the BorrowerBorrowerPerson who is the obligor under the Note. for

the cost of a standalone HPB Report, or
the incremental cost of the HPB ModuleHPB ModulePCA High Performance Building Module assessing cost effective opportunities to increase a Property’s energy and water efficiency and reduce costs. over the cost of the base PCAPCAAssessment of the current physical condition and historical operation of the Property. .

If you use the Origination FeeOrigination FeeFee charged by the Lender to the Borrower for underwriting and originating the Mortgage Loan, per Part IV A: Mortgage Loan Commitment, Delivery and Purchase Procedures, Section 202. to pay the Borrower'sBorrower'sPerson who is the obligor under the Note. costs for the HPB Report or HPB ModuleHPB ModulePCA High Performance Building Module assessing cost effective opportunities to increase a Property’s energy and water efficiency and reduce costs. , Fannie Mae will reimburse you when you deliver the Green Mortgage LoanGreen Mortgage LoanMortgage Loan secured by a Property that incorporates features expected to have a positive environmental outcome including, but not limited to, reducing energy and water consumption at a Property, generating energy, or meeting criteria set by a third-party green building certification organization….

Operating Procedures

To submit the invoice for the HPB ModuleHPB ModulePCA High Performance Building Module assessing cost effective opportunities to increase a Property’s energy and water efficiency and reduce costs. or HPB Report for reimbursement, use the Green Mortgage Loan Job Aid.

401.03	Technical Solar Report

Requirements

For a Green Rewards Mortgage LoanGreen Rewards Mortgage LoanMortgage Loan secured by a Property on which the Borrower agrees to undertake 1 or more Energy- and Water-Efficiency Measures (Efficiency Measures or EWEM) that comply with Part III: Products and Features, Section 403. where the BorrowerBorrowerPerson who is the obligor under the Note. wants to install a Solar Photovoltaic SystemSolar Photovoltaic SystemA renewable energy system that converts sunlight into electricity. (Solar PV System) as an Efficiency MeasureEfficiency MeasureEnergy- and water-efficiency measures that the Borrower agrees to implement, and which project a reduction in the Property’s annual energy or water consumption. , you must retain a Solar Technical Consultant that is certified by the North American Board of Certified Energy Practitioners (NABCEP) to complete a Technical Solar Report, including Appendix I: Analysis Tool for a Technical Solar Assessment (Form 4099.I), per the Instructions for Performing a Multifamily Property Condition Assessment (Form 4099).

Guidance

If you use the Origination FeeOrigination FeeFee charged by the Lender to the Borrower for underwriting and originating the Mortgage Loan, per Part IV A: Mortgage Loan Commitment, Delivery and Purchase Procedures, Section 202. to pay the BorrowerBorrowerPerson who is the obligor under the Note.’s costs for the Technical Solar Report, Fannie Mae will reimburse you when you deliver the Green Mortgage LoanGreen Mortgage LoanMortgage Loan secured by a Property that incorporates features expected to have a positive environmental outcome including, but not limited to, reducing energy and water consumption at a Property, generating energy, or meeting criteria set by a third-party green building certification organization… if a Solar PV SystemSolar PV SystemA renewable energy system that converts sunlight into electricity. is selected as an Efficiency MeasureEfficiency MeasureEnergy- and water-efficiency measures that the Borrower agrees to implement, and which project a reduction in the Property’s annual energy or water consumption. .

Operating Procedure

You must ensure:

The HPB Consultant completes the HPB ModuleHPB ModulePCA High Performance Building Module assessing cost effective opportunities to increase a Property’s energy and water efficiency and reduce costs. .
The Solar Technical Consultant completes a Technical Solar Report, including Form 4099.I, that
- identifies and quantifies the renewable energy generation potential at the PropertyPropertyMultifamily residential property securing the Mortgage Loan and including the land (or Leasehold interest in land), Improvements, and personal property (as defined in the Uniform Commercial Code). ,
- details the system design specifications of any recommended Solar PV SystemSolar PV SystemA renewable energy system that converts sunlight into electricity. , and
- includes a contingency of at least 5% of the total estimated hard costs.
If the Technical Solar Report confirms the PropertyPropertyMultifamily residential property securing the Mortgage Loan and including the land (or Leasehold interest in land), Improvements, and personal property (as defined in the Uniform Commercial Code). is suitable for a Solar PV SystemSolar PV SystemA renewable energy system that converts sunlight into electricity. , and the BorrowerBorrowerPerson who is the obligor under the Note. elects to install a Solar PV SystemSolar PV SystemA renewable energy system that converts sunlight into electricity. at the PropertyPropertyMultifamily residential property securing the Mortgage Loan and including the land (or Leasehold interest in land), Improvements, and personal property (as defined in the Uniform Commercial Code). as an Efficiency MeasureEfficiency MeasureEnergy- and water-efficiency measures that the Borrower agrees to implement, and which project a reduction in the Property’s annual energy or water consumption. , the HPB Consultant incorporates the Solar PV SystemSolar PV SystemA renewable energy system that converts sunlight into electricity. design specifications, and any required roof replacement or additional structural support, from the Technical Solar Assessment (Form 4099.I) into Form 4099.H.
For reimbursement, you submit the Technical Solar Report invoice per the Green Mortgage Loan Job Aid.

401.04	Green MBS

Requirements

You must disclose as a Green MBS any Green Mortgage LoanGreen Mortgage LoanMortgage Loan secured by a Property that incorporates features expected to have a positive environmental outcome including, but not limited to, reducing energy and water consumption at a Property, generating energy, or meeting criteria set by a third-party green building certification organization… that you deliver as an MBS Mortgage LoanMBS Mortgage LoanMortgage Loan purchased by Fannie Mae in exchange for an issued MBS backed by the Mortgage Loan. .

401.05	Committing and Delivery

Operating Procedures

To commit and deliver a Green Mortgage LoanGreen Mortgage LoanMortgage Loan secured by a Property that incorporates features expected to have a positive environmental outcome including, but not limited to, reducing energy and water consumption at a Property, generating energy, or meeting criteria set by a third-party green building certification organization…, you must follow the Green Mortgage Loan Job Aid.

Section 402	Green Building Certification

Requirements

To qualify as a Green Mortgage LoanGreen Mortgage LoanMortgage Loan secured by a Property that incorporates features expected to have a positive environmental outcome including, but not limited to, reducing energy and water consumption at a Property, generating energy, or meeting criteria set by a third-party green building certification organization…, you must:

ensure that the PropertyPropertyMultifamily residential property securing the Mortgage Loan and including the land (or Leasehold interest in land), Improvements, and personal property (as defined in the Uniform Commercial Code). has a Green Building CertificationGreen Building CertificationDesignation awarded by a third-party organization that is recognized by Fannie Mae and listed in the Green Building Certifications (Form 4250) for multifamily properties constructed or maintained to meet specified energy and water efficiency standards or other sustainability criteria. that:
- is recognized by Fannie Mae and listed in the Green Building Certifications (Form 4250);
- applies specifically to the PropertyPropertyMultifamily residential property securing the Mortgage Loan and including the land (or Leasehold interest in land), Improvements, and personal property (as defined in the Uniform Commercial Code). and not just to a development site that includes the PropertyPropertyMultifamily residential property securing the Mortgage Loan and including the land (or Leasehold interest in land), Improvements, and personal property (as defined in the Uniform Commercial Code). ;
- covers all residential units of the PropertyPropertyMultifamily residential property securing the Mortgage Loan and including the land (or Leasehold interest in land), Improvements, and personal property (as defined in the Uniform Commercial Code). ;
- was awarded no more than 5 years before Rate LockRate LockAgreement between the Lender and the Investor containing the terms of the Lender-Arranged Sale or Multifamily Trading Desk trade of the Mortgage Loan and the MBS terms and conditions relating to the underlying MBS, if applicable, which may be documented via a recorded telephone conversation. ; and
- is in effect at the time of Rate LockRate LockAgreement between the Lender and the Investor containing the terms of the Lender-Arranged Sale or Multifamily Trading Desk trade of the Mortgage Loan and the MBS terms and conditions relating to the underlying MBS, if applicable, which may be documented via a recorded telephone conversation. ; and
review and approve a Green Building CertificationGreen Building CertificationDesignation awarded by a third-party organization that is recognized by Fannie Mae and listed in the Green Building Certifications (Form 4250) for multifamily properties constructed or maintained to meet specified energy and water efficiency standards or other sustainability criteria. prior to
- Rate LockRate LockAgreement between the Lender and the Investor containing the terms of the Lender-Arranged Sale or Multifamily Trading Desk trade of the Mortgage Loan and the MBS terms and conditions relating to the underlying MBS, if applicable, which may be documented via a recorded telephone conversation. , if you are not using the Streamlined Rate Lock option, or
- the Mortgage Loan Origination DateMortgage Loan Origination DateDate the Lender funds a Mortgage Loan to the Borrower. , if you are using the Streamlined Rate Lock option.

Section 403	Green Rewards Mortgage Loans

403.01	Eligibility

403.01A	Generally

Requirements

the PropertyPropertyMultifamily residential property securing the Mortgage Loan and including the land (or Leasehold interest in land), Improvements, and personal property (as defined in the Uniform Commercial Code). has at least 12 months of Stabilized Residential OccupancyStabilized Residential OccupancyPercentage of Property units physically occupied by Qualified Occupants, per Part II: Property, Section 104.02 as adjusted for the applicable Part III products and features. ;
the BorrowerBorrowerPerson who is the obligor under the Note. selects Efficiency MeasuresEfficiency MeasuresEnergy- and water-efficiency measures that the Borrower agrees to implement, and which project a reduction in the Property’s annual energy or water consumption. from the HPB ModuleHPB ModulePCA High Performance Building Module assessing cost effective opportunities to increase a Property’s energy and water efficiency and reduce costs. or HPB Report projected to result in an annual reduction for the whole PropertyPropertyMultifamily residential property securing the Mortgage Loan and including the land (or Leasehold interest in land), Improvements, and personal property (as defined in the Uniform Commercial Code). of at least 30% in combined energy and/or water consumption of which at least 15% must be attributable to savings in energy consumption; and
for a Manufactured Housing CommunityManufactured Housing CommunityResidential real estate development with lots on which manufactured homes are located, together with amenities, utility services, landscaping, roads, and other infrastructure. ,
- the 15% energy consumption savings is achieved only through the installation of a Solar PV SystemSolar PV SystemA renewable energy system that converts sunlight into electricity. or other renewable energy system,
- all Efficiency MeasuresEfficiency MeasuresEnergy- and water-efficiency measures that the Borrower agrees to implement, and which project a reduction in the Property’s annual energy or water consumption. , including the Solar PV SystemSolar PV SystemA renewable energy system that converts sunlight into electricity. , are made only to BorrowerBorrowerPerson who is the obligor under the Note.-owned property,
- electricity is metered at the whole PropertyPropertyMultifamily residential property securing the Mortgage Loan and including the land (or Leasehold interest in land), Improvements, and personal property (as defined in the Uniform Commercial Code). level (master-metered) by the utility to the PropertyPropertyMultifamily residential property securing the Mortgage Loan and including the land (or Leasehold interest in land), Improvements, and personal property (as defined in the Uniform Commercial Code). owner (even if reimbursed by the tenants), and
- the energy or water consumption reduction is based only on utilities that are metered at the whole PropertyPropertyMultifamily residential property securing the Mortgage Loan and including the land (or Leasehold interest in land), Improvements, and personal property (as defined in the Uniform Commercial Code). level (master-metered).

Energy consumption savings may represent reductions in whole-PropertyPropertyMultifamily residential property securing the Mortgage Loan and including the land (or Leasehold interest in land), Improvements, and personal property (as defined in the Uniform Commercial Code). consumption of energy supplied by utilities or energy suppliers (including delivered energy such as fuel oil or propane) compared to the previous 12-month baseline through a combination of the installation of an onsite renewable energy system and energy efficiency measures.

403.01B	HPB Module, HPB Report, and Technical Solar Report Scoring

Requirements

You must score each HPB ModuleHPB ModulePCA High Performance Building Module assessing cost effective opportunities to increase a Property’s energy and water efficiency and reduce costs. , HPB Report, and Technical Solar Report per the following 3-point system:

Score	Quality of HPB Module, HPB Report, and Technical Solar Report
1	Either you or Fannie Mae may approve as is. No further corrections.
2	The consultant must address minor issues or clarify content before you or Fannie Mae approve it. Minor corrections.
3	The consultant must make major changes or multiple revisions before you or Fannie Mae approve it. Substantial issues.

The final HPB ModuleHPB ModulePCA High Performance Building Module assessing cost effective opportunities to increase a Property’s energy and water efficiency and reduce costs. , HPB Report, and Technical Solar Report must be scored as a "1" before you approve the report or submit it to Fannie Mae for approval, if required.

403.01C	HPB Module, HPB Report, and Technical Solar Report Approval

Requirements

You must submit an HPB Report or HPB ModuleHPB ModulePCA High Performance Building Module assessing cost effective opportunities to increase a Property’s energy and water efficiency and reduce costs. to Fannie Mae for approval if:

you have delivered less than 8 Mortgage LoansMortgage LoansMortgage debt obligation evidenced, or when made will be evidenced, by the Loan Documents or a mortgage debt obligation with a Fannie Mae credit enhancement. that included an HPB Report (or a PCA ReportPCA ReportProperty Condition Assessment Report documenting the findings of a PCA. containing an HPB ModuleHPB ModulePCA High Performance Building Module assessing cost effective opportunities to increase a Property’s energy and water efficiency and reduce costs. ); or
your HPB Consultant has not been designated as “Pre-Qualified” by Fannie Mae at www.fanniemaegreenfinancing.com.

Before Rate LockRate LockAgreement between the Lender and the Investor containing the terms of the Lender-Arranged Sale or Multifamily Trading Desk trade of the Mortgage Loan and the MBS terms and conditions relating to the underlying MBS, if applicable, which may be documented via a recorded telephone conversation. , you must submit any Technical Solar Report to Fannie Mae for approval.

Operating Procedures

If Fannie Mae’s approval of an HPB ModuleHPB ModulePCA High Performance Building Module assessing cost effective opportunities to increase a Property’s energy and water efficiency and reduce costs. , HPB Report, or Technical Solar Report is required, you must:

Submit in DUS GatewayDUS GatewayMultifamily pre-acquisition system including deal registration, Pre-Review and/or waiver tracking, decision records, or any successor systems. , per the Green Mortgage Loan Job Aid, the
- HPB ModuleHPB ModulePCA High Performance Building Module assessing cost effective opportunities to increase a Property’s energy and water efficiency and reduce costs. or HPB Report and Form 4099.H, or
- Technical Solar Report and Form 4099.I.
Follow this submission timing:
- For the HPB ModuleHPB ModulePCA High Performance Building Module assessing cost effective opportunities to increase a Property’s energy and water efficiency and reduce costs. or HPB Report,
  - at least 5 days before Rate LockRate LockAgreement between the Lender and the Investor containing the terms of the Lender-Arranged Sale or Multifamily Trading Desk trade of the Mortgage Loan and the MBS terms and conditions relating to the underlying MBS, if applicable, which may be documented via a recorded telephone conversation. , if not using the Streamlined Rate Lock option, or
  - at least 10 days before the Mortgage Loan Origination DateMortgage Loan Origination DateDate the Lender funds a Mortgage Loan to the Borrower. , if using the Streamlined Rate Lock option.
- For the Technical Solar Report, at least 10 days before Rate LockRate LockAgreement between the Lender and the Investor containing the terms of the Lender-Arranged Sale or Multifamily Trading Desk trade of the Mortgage Loan and the MBS terms and conditions relating to the underlying MBS, if applicable, which may be documented via a recorded telephone conversation. .

403.01D	Non-Contiguous Parcels

Requirements

For a Mortgage LoanMortgage LoanMortgage debt obligation evidenced, or when made will be evidenced, by the Loan Documents or a mortgage debt obligation with a Fannie Mae credit enhancement. secured by Non-Contiguous ParcelsNon-Contiguous ParcelsMultiple parcels of land securing a Mortgage Loan that do not share common boundaries or that are separated by dedicated or private streets that are major arterials. , a separate HPB ModuleHPB ModulePCA High Performance Building Module assessing cost effective opportunities to increase a Property’s energy and water efficiency and reduce costs. , HPB Report, or Technical Solar Report is required for each Collateral Record in C&DC&DElectronic committing and delivery system used for issuing and confirming Commitments for acquiring Mortgage Loans, or any such successor system. .

403.02	Implementing Efficiency Measures

403.02A	Generally

Requirements

After the BorrowerBorrowerPerson who is the obligor under the Note. selects the Efficiency MeasuresEfficiency MeasuresEnergy- and water-efficiency measures that the Borrower agrees to implement, and which project a reduction in the Property’s annual energy or water consumption. , you must:

Include the selected Efficiency MeasuresEfficiency MeasuresEnergy- and water-efficiency measures that the Borrower agrees to implement, and which project a reduction in the Property’s annual energy or water consumption. in the Completion/Repair AgreementCompletion/Repair AgreementDocument evidencing the Borrower’s agreement to undertake Completion/Repairs and other identified capital improvements, the terms for funding the repairs, maintenance, or capital items, and the disbursement of funds from the Completion/Repair Escrow (e.g., Form 4505, or the applicable parts of the… or the Rehabilitation Reserve AgreementRehabilitation Reserve AgreementBorrower’s agreement to undertake identified Rehabilitation Work, the terms for funding the Rehabilitation Work, and the disbursement of funds from the Rehabilitation Reserve Account (e.g., Form 6222.Mod, Form 6222.Sub, or Form 4523). .
Describe each Efficiency MeasureEfficiency MeasureEnergy- and water-efficiency measures that the Borrower agrees to implement, and which project a reduction in the Property’s annual energy or water consumption. in enough detail to ensure that any specific products or equipment are installed, including quantities and applicable performance specifications.
Ensure funds to complete the selected Efficiency MeasuresEfficiency MeasuresEnergy- and water-efficiency measures that the Borrower agrees to implement, and which project a reduction in the Property’s annual energy or water consumption. are deposited into the Completion/Repair EscrowCompletion/Repair EscrowCustodial Account established by the Lender and initially funded by an escrow deposit from the Borrower on the Mortgage Loan Origination Date to complete Completion/Repairs or other capital improvements at the Property. or the Rehabilitation Reserve AccountRehabilitation Reserve AccountCustodial Account established by the Lender and funded by deposits from the Borrower per the Rehabilitation Reserve Agreement to fund the Rehabilitation Work. , in an amount equal to the greater of:
- 100% of the estimated cost of all capital improvements identified by the HPB ModuleHPB ModulePCA High Performance Building Module assessing cost effective opportunities to increase a Property’s energy and water efficiency and reduce costs. , HPB Report, or Technical Solar Report for the selected Efficiency MeasuresEfficiency MeasuresEnergy- and water-efficiency measures that the Borrower agrees to implement, and which project a reduction in the Property’s annual energy or water consumption. (plus any amount that you decide to include for cost overruns); or
- any higher funding percentage you may require for capital improvements identified as Immediate Repairs by the PCAPCAAssessment of the current physical condition and historical operation of the Property. .
Ensure all Efficiency MeasuresEfficiency MeasuresEnergy- and water-efficiency measures that the Borrower agrees to implement, and which project a reduction in the Property’s annual energy or water consumption. are completed in a timely manner and no later than
- 12 months after the Mortgage Loan Origination DateMortgage Loan Origination DateDate the Lender funds a Mortgage Loan to the Borrower. , or
- any shorter time period required by Part II, Chapter 4: Inspections and Reserves, Section 402: Property Condition Assessment (PCA) for capital improvements identified as Immediate Repairs by the PCAPCAAssessment of the current physical condition and historical operation of the Property. .
- Ensure the funds in the Completion/Repair EscrowCompletion/Repair EscrowCustodial Account established by the Lender and initially funded by an escrow deposit from the Borrower on the Mortgage Loan Origination Date to complete Completion/Repairs or other capital improvements at the Property. for any Solar PV SystemSolar PV SystemA renewable energy system that converts sunlight into electricity. are released only after confirming commercial operation.

403.02B	Solar PV System

Requirements

All Solar PV SystemSolar PV SystemA renewable energy system that converts sunlight into electricity. equipment, including energy storage, will be BorrowerBorrowerPerson who is the obligor under the Note.-owned and located on the PropertyPropertyMultifamily residential property securing the Mortgage Loan and including the land (or Leasehold interest in land), Improvements, and personal property (as defined in the Uniform Commercial Code). .

The PropertyPropertyMultifamily residential property securing the Mortgage Loan and including the land (or Leasehold interest in land), Improvements, and personal property (as defined in the Uniform Commercial Code). will remain connected to the utility grid.
The BorrowerBorrowerPerson who is the obligor under the Note. enters into an Operations and Maintenance PlanOperations and Maintenance PlanWritten plan, document, or agreement containing ongoing operating, maintenance, or monitoring actions for the Property or its Improvements. covering the Mortgage LoanMortgage LoanMortgage debt obligation evidenced, or when made will be evidenced, by the Loan Documents or a mortgage debt obligation with a Fannie Mae credit enhancement. term.
The Solar PV SystemSolar PV SystemA renewable energy system that converts sunlight into electricity. has a minimum manufacturer performance warranty of 25-years for the solar panels, and a minimum 10-year product warranty for:

solar panels;
inverters;
racking systems; and
batteries for energy storage.

Roof age and condition support Solar PV SystemSolar PV SystemA renewable energy system that converts sunlight into electricity. design and installation, and any roof replacement specified in the Technical Solar Report is included as an Efficiency MeasureEfficiency MeasureEnergy- and water-efficiency measures that the Borrower agrees to implement, and which project a reduction in the Property’s annual energy or water consumption. .
A performance guaranty that covers the full term of the Mortgage LoanMortgage LoanMortgage debt obligation evidenced, or when made will be evidenced, by the Loan Documents or a mortgage debt obligation with a Fannie Mae credit enhancement. is required for systems over 500kW;
Battery storage is for on-site use only and does not commit the PropertyPropertyMultifamily residential property securing the Mortgage Loan and including the land (or Leasehold interest in land), Improvements, and personal property (as defined in the Uniform Commercial Code). to an arrangement with any utility, third-party, or off-site use.
Outside counsel with Solar PV SystemSolar PV SystemA renewable energy system that converts sunlight into electricity. experience and state-specific knowledge reviews all applicable local laws and any contracts or agreements related to the Solar PV SystemSolar PV SystemA renewable energy system that converts sunlight into electricity. installation and operation.
The Solar PV SystemSolar PV SystemA renewable energy system that converts sunlight into electricity. installer has a team member or subcontractor who is NABCEP certified.

403.03	Underwritten NCF

Requirements

You must ensure that the Underwritten NCFUnderwritten NCFNet Cash Flow as adjusted by the Lender per Part II, Chapter 2: Valuation and Income, Section 202: Income Analysis and the applicable products and features in Part III. for a Green Rewards Mortgage LoanGreen Rewards Mortgage LoanMortgage Loan secured by a Property on which the Borrower agrees to undertake 1 or more Energy- and Water-Efficiency Measures (Efficiency Measures or EWEM) that comply with Part III: Products and Features, Section 403. is calculated per Part II, Chapter 2: Valuation and Income or the applicable Part III Chapter.

For any Green Rewards Mortgage LoanGreen Rewards Mortgage LoanMortgage Loan secured by a Property on which the Borrower agrees to undertake 1 or more Energy- and Water-Efficiency Measures (Efficiency Measures or EWEM) that comply with Part III: Products and Features, Section 403. where the BorrowerBorrowerPerson who is the obligor under the Note. elects to install a Solar PV SystemSolar PV SystemA renewable energy system that converts sunlight into electricity. as an Efficiency MeasureEfficiency MeasureEnergy- and water-efficiency measures that the Borrower agrees to implement, and which project a reduction in the Property’s annual energy or water consumption. , the Underwritten NCFUnderwritten NCFNet Cash Flow as adjusted by the Lender per Part II, Chapter 2: Valuation and Income, Section 202: Income Analysis and the applicable products and features in Part III. must include all new or increased operating expenses associated with the Solar PV SystemSolar PV SystemA renewable energy system that converts sunlight into electricity. , such as:

Operations and Maintenance PlanOperations and Maintenance PlanWritten plan, document, or agreement containing ongoing operating, maintenance, or monitoring actions for the Property or its Improvements. fees;
real estate taxes;
property and liability insurance;
utility fees; and
replacement reserves.

Guidance

You may include projected energy and water cost savings from implementing selected Efficiency MeasuresEfficiency MeasuresEnergy- and water-efficiency measures that the Borrower agrees to implement, and which project a reduction in the Property’s annual energy or water consumption. when calculating Underwritten NCFUnderwritten NCFNet Cash Flow as adjusted by the Lender per Part II, Chapter 2: Valuation and Income, Section 202: Income Analysis and the applicable products and features in Part III. , up to:

75% of any cost savings projected to accrue to the BorrowerBorrowerPerson who is the obligor under the Note.; plus
25% of any cost savings projected to accrue to the tenants, but only if the projections are based on whole-PropertyPropertyMultifamily residential property securing the Mortgage Loan and including the land (or Leasehold interest in land), Improvements, and personal property (as defined in the Uniform Commercial Code). or sampled (not modeled) consumption as defined by Form 4099.

403.04	Maximum Amount

Requirements

The maximum amount of a Green Rewards Mortgage LoanGreen Rewards Mortgage LoanMortgage Loan secured by a Property on which the Borrower agrees to undertake 1 or more Energy- and Water-Efficiency Measures (Efficiency Measures or EWEM) that comply with Part III: Products and Features, Section 403. that includes projected cost savings in the Underwritten NCFUnderwritten NCFNet Cash Flow as adjusted by the Lender per Part II, Chapter 2: Valuation and Income, Section 202: Income Analysis and the applicable products and features in Part III. must not exceed 105% of the Mortgage LoanMortgage LoanMortgage debt obligation evidenced, or when made will be evidenced, by the Loan Documents or a mortgage debt obligation with a Fannie Mae credit enhancement. amount based on the Underwritten NCFUnderwritten NCFNet Cash Flow as adjusted by the Lender per Part II, Chapter 2: Valuation and Income, Section 202: Income Analysis and the applicable products and features in Part III. excluding the projected cost savings.

403.05	Supplemental Mortgage Loans

Requirements

You must base the maximum Green RewardsGreen RewardsMortgage Loan secured by a Property on which the Borrower agrees to undertake 1 or more Energy- and Water-Efficiency Measures (Efficiency Measures or EWEM) that comply with Part III: Products and Features, Section 403. Supplemental Mortgage LoanSupplemental Mortgage LoanMortgage Loan purchased by Fannie Mae that is subordinated to, and has a Mortgage Loan Origination Date after, the Senior Mortgage Loan that is also owned by Fannie Mae. amount on the aggregate UPBUPBUnpaid Principal Balance of all Pre-Existing Mortgage LoansPre-Existing Mortgage LoansMultifamily residential real estate loan secured by Liens against the Property having higher priority than the Lien securing the Subordinate Loan purchased by Fannie Mae. secured by the PropertyPropertyMultifamily residential property securing the Mortgage Loan and including the land (or Leasehold interest in land), Improvements, and personal property (as defined in the Uniform Commercial Code). , plus the amount of the Green RewardsGreen RewardsMortgage Loan secured by a Property on which the Borrower agrees to undertake 1 or more Energy- and Water-Efficiency Measures (Efficiency Measures or EWEM) that comply with Part III: Products and Features, Section 403. Supplemental Mortgage LoanSupplemental Mortgage LoanMortgage Loan purchased by Fannie Mae that is subordinated to, and has a Mortgage Loan Origination Date after, the Senior Mortgage Loan that is also owned by Fannie Mae. .

Guidance

Certain Green RewardsGreen RewardsMortgage Loan secured by a Property on which the Borrower agrees to undertake 1 or more Energy- and Water-Efficiency Measures (Efficiency Measures or EWEM) that comply with Part III: Products and Features, Section 403. Supplemental Mortgage LoansSupplemental Mortgage LoansMortgage Loan purchased by Fannie Mae that is subordinated to, and has a Mortgage Loan Origination Date after, the Senior Mortgage Loan that is also owned by Fannie Mae. may not count toward the limit on the number of Supplemental Mortgage LoansSupplemental Mortgage LoansMortgage Loan purchased by Fannie Mae that is subordinated to, and has a Mortgage Loan Origination Date after, the Senior Mortgage Loan that is also owned by Fannie Mae. (see Part III, Chapter 14: Supplemental Mortgage Loans, Section 1402: Supplemental Mortgage Loans).

Section 404	Annual Energy Reporting

Requirements

You must use the following forms requiring the BorrowerBorrowerPerson who is the obligor under the Note. to report the Property'sProperty'sMultifamily residential property securing the Mortgage Loan and including the land (or Leasehold interest in land), Improvements, and personal property (as defined in the Uniform Commercial Code). annual energy and water use:

for a Green Rewards Mortgage LoanGreen Rewards Mortgage LoanMortgage Loan secured by a Property on which the Borrower agrees to undertake 1 or more Energy- and Water-Efficiency Measures (Efficiency Measures or EWEM) that comply with Part III: Products and Features, Section 403. where the BorrowerBorrowerPerson who is the obligor under the Note. elects to install a Solar PV SystemSolar PV SystemA renewable energy system that converts sunlight into electricity. , Modifications to Multifamily Loan and Security Agreement (Green/Solar Mortgage Loan) (Form 6264);
for any other Green Rewards Mortgage LoanGreen Rewards Mortgage LoanMortgage Loan secured by a Property on which the Borrower agrees to undertake 1 or more Energy- and Water-Efficiency Measures (Efficiency Measures or EWEM) that comply with Part III: Products and Features, Section 403. , Modifications to Multifamily Loan and Security Agreement (Green Mortgage Loan) (Form 6241); or
for any Green Mortgage LoanGreen Mortgage LoanMortgage Loan secured by a Property that incorporates features expected to have a positive environmental outcome including, but not limited to, reducing energy and water consumption at a Property, generating energy, or meeting criteria set by a third-party green building certification organization… PropertyPropertyMultifamily residential property securing the Mortgage Loan and including the land (or Leasehold interest in land), Improvements, and personal property (as defined in the Uniform Commercial Code). with a Green Building CertificationGreen Building CertificationDesignation awarded by a third-party organization that is recognized by Fannie Mae and listed in the Green Building Certifications (Form 4250) for multifamily properties constructed or maintained to meet specified energy and water efficiency standards or other sustainability criteria. , Modifications to Multifamily Loan and Security Agreement (Green Building Certification) (Form 6267).