HERO Program Blog & Home Sustainabilty Blog - Procoating.com

How HERO Program Payments Work

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The HERO Program is an innovative way for property owners to finance energy-efficient home improvement projects. Many such projects are covered, from upgrading home insulation to replacing doors and windows, HVAC systems, and installing solar panels. Many property owners, however, don’t understand how HERO program payments work.

What is the HERO Program, and How Does it Work?

In simple terms, the HERO Program is a financing system that helps property owners pay for energy-efficient improvement projects. HERO is made possible by legislation called PACE: Property Assessed Clean Energy, which has been enacted in 31 U.S. states.

When a property owner applies for HERO financing, there are no up-front costs. In fact, HERO boasts no out-of-pocket costs, including fees and any labor costs associated with energy-saving upgrade projects. There are no application fees, either. Property owners borrow against the equity in their properties; interest rates are competitive with more traditional home improvement loans.

How Do HERO Payments Work?

To recoup the money lent for energy-saving home improvement projects, HERO financing is paid directly through the owner’s property tax bill. Property owners will see a line item entitled “HERO FINANCING” on their annual property tax bill. Property taxes are collected in different ways by city, county, and state authorities. In general, though, property owners often make tax payments through something called “impound escrow accounts”, where a portion of monthly mortgage payments is collected for the purpose of paying taxes. The property mortgage’s primary lender will adjust monthly payments to include the amount due for HERO financing.

Sometimes in the first year of paying off HERO financing solutions, property owners may see higher amounts due. This is a temporary situation; the mortgage servicer or lender is paying prior amounts while escrowing the next tax payment. Over time, the HERO financing is paid off. Typical payoff durations range from five to 25-year terms.

HERO financing is a great way to pay for home improvement projects that save significant energy costs. It makes such projects more affordable than ever!

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