Sol Rosenbaum PE, CEM, CPMP is director of Green & Energy Services at GRS Group. He can be reached at (443) 320-0429 or by email at

An (essentially) FREE energy and water audit? Yes, but with some caveats, of course.       

In my previous articles, I have detailed the Fannie Mae Green Rewards and Freddie Mac Green Up programs and how they have helped many properties get lower rates on their loans.  However, one area that was not included was the reimbursements that each agency provides, making these reports essentially free to the borrower.

Due to a (temporary) change in the reimbursement rates from Fannie Mae, I decided the time was right to address this issue and review the reimbursement schemes for each agency.

What was Fannie Mae’s previous plan?

Until the recent change, Fannie Mae would reimburse borrowers the full cost of the green report with no specific limit on the charges.  The reimbursement hinged on a two-fold criteria; the borrower had to close with Fannie Mae and the loan had to go green.  Of note, while the reimbursement cost has no specific limit, there is a de-facto limit in place based on the expected cost range for these reports. 

So how has this changed?

On March 22, 2019, Fannie Mae announced that they are changing their criteria for reimbursement to only require the borrower to close the loan with Fannie Mae.  The secondary caveat that the loan goes green was dropped.  In their announcement, Fannie Mae noted that this new structure will be in place for loans that are Under Application in DUS Gateway® no later than May 20, 2019.

Why did Fannie Mae make this change?  Due to the FHFA mandated changes to the program for 2019, they were seeing some hesitancy in the market from some borrowers to use the Green Rewards program.  Therefore, they put this temporary structure in place to encourage more green engagement.

Will this new structure become permanent?  That would be nice, but, at this time, I have no indication that it will be permanent.  All we know is that it will remain under this plan through most of May 2019. 

Where does Freddie Mac stand with their reimbursement plan?

The Freddie Mac reimbursement plan is fairly similar to the temporary plan that Fannie Mae has announced.  Freddie Mac only requires that the loan closes with them in order to be reimbursed for the cost of the green report.  However, Freddie Mac has a cap of $3,500 that they will reimburse towards the report. 

Regardless of the agency with whom you choose, both programs offer the borrower a great opportunity to receive reduced loan interest rates to incentivize investment in energy/water savings projects. 

Please be in touch with me or your GRS Group representative if you have any questions about a specific project or about the programs in general.

About GRS Group

GRS Group is a leading provider of commercial real estate (“CRE”) services worldwide. With offices across the United States, Europe, and affiliates around the globe, GRS Group provides local market knowledge with a global perspective for institutional real estate investors, occupiers and lenders worldwide. The GRS Group team has evaluated and advised on over $1 trillion in CRE transactions.

Through the company’s proprietary management process, Global Services Connection, GRS Group delivers an integrated suite of services including Financial Advisory, Transaction Management, Assessment and Title Insurance.  We provide a single point of contact, capable of leveraging the GRS Group portfolio of companies and delivering customized solutions to assist our clients in achieving their investment goals.