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LEED can seem complex, but it provides a starting point -- a standard framework for analysis that is recognized by the building industries. Brokers and lenders can benefit from understanding and applying LEED, as well as from considering international standards from Europe, Asia and Australia.
Ultimately, borrowers can see savings from green building in a number of ways. Some lenders will provide funds to them at a slightly lower cost in terms of rates and points. Other lenders give preference in the lending queue to green projects, providing faster funding. And others underwrite to higher LTVs because they believe that these borrowers demonstrate responsibility and long-term perspective from the outset.
Brokers and lenders are in a position to encourage and influence builders and developers to do the good, smart thing -- to take the higher path and build smart for the long term. Brokers can play a pivotal role by querying borrowers about their intentions and whenever possible, explaining the benefits of incorporating green and sustainable components into their projects. By doing this, we're demonstrating to all the other stakeholders in our business -- government agencies, investors and the community at large -- that we clearly get the big picture.
If appealing to your clients by emphasizing the common good reaches deaf ears, then appeal to them by explaining financial incentives of green building. In the end, the solution really lies in awareness and in thinking about immediate and future outcomes.
Richard Zahm is a principal of Second Angel Bancorp,
a California-based mortgage bank and direct lender, providing residential and commercial funding. Reach him at (916) 863-7300 or rz@SecondAngel.net, or visit the company's Web site, www.SecondAngel.net.
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