Bank Australia teams up with CEFC to launch new clean energy home loan
Bank Australia, the self-proclaimed ‘bank Australia needs’ is truly putting its ‘clean money’ where its mouth is with the launch of its new Clean Energy Home Loan.
That’s right the bank that doesn’t invest in fossil fuels, live animal export or gambling has partnered up with the Clean Energy Finance Corporation to offer eligible borrowers a home loan with a distinctly green incentive; a discount of 0.40%.
Just how low are the interest rates for the Clean Energy Home Loan?
This is where the CEFC comes in, because with the financial support of this green-centred finance corporation, Bank Australia are able to offer borrowers a 0.40% discount. The new green home loan comes as either a fixed interest rate home loan or a variable interest rate home loan. And with interest rates starting firmly in the 2% club, it’s a financial partnership that has certainly paid off.
In fact, if you are planning to buy or build an energy efficient home, then you could benefit from an interest rate as low as 2.44% p.a. (3.50% comparison rate*). This particular interest rate is currently the lowest on offer for a 2 year fixed interest rate loan in the Mozo database. The loan is available to borrowers with an LVR less than 70% (Loan to Value Ratio) and as with most fixed interest rate home loans, the discount applies for the full, fixed 2 year period.
But that’s not all, because if you’re looking to take out a loan of more than $500,000 to finance your clean energy dreams, you’ll be happy to hear that variable interest rates start as low as 2.78% p.a. (3.39% comparison rate*, LVR less than 70%). For variable interest rates, the discounted rate will apply for the first five years of the loan.
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What criteria do I need to meet to be eligible for Bank Australia’s Clean Energy Home Loan?
To be eligible for Bank Australia’s Clean Energy Home Loan you will have to be either buying or building a home rated a minimum of 7 stars under the Nationwide House Energy Rating Scheme (NatHERS).
With this scheme buildings can be awarded a star rating out of 10, based on how efficient the energy use is. What does that look like? Well a house with an energy rating as high as 7 stars, should not only be able to stay cooler in the summer and warmer in the winter without the use of air conditioners or heaters, but it should also be designed to work better with its environment.
An energy efficient home is by default, kinder to the environment. It uses less electricity and is often made of better quality materials.
As CEFC CEO Ian Learmonth said, “This green home loan will fill a gap in the market, giving builders and new home buyers a financial incentive to adopt sustainable design principles from the start of the project.”
Learmonth pointed out that although Australia is leading the way in residential rooftop solar, the next step to get serious about cutting carbon emissions, is to start investing in better building design and construction.
RELATED ARTICLE: Why the bigger banks aren’t always the best place to find a home loan in 2020
What’s next for Bank Australia's green home loan?
If you’re aiming higher than a 7 star NatHERS rating for your new clean energy efficient home, then you might want to hold your non-racing horses, because Bank Australia are also planning to offer higher discounts for homes with a higher energy efficiency rating in the near future.
Don’t quite have the funds to make your environmentally harmonious home a reality just yet? Why not check out the home loan deals below or head to our home loans comparison page, for a full list of home loans compared by Mozo.
Compare home loans - last updated January 17, 2021
Search promoted home loans below or do a full Mozo database search. Advertiser disclosure.
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1.99% p.a.variable for 12 months and then 2.48% p.a. variable
2.47% p.a.
Smart Booster Home Loan
1 Year Discounted Variable Rate, Owner Occupier, Principal & Interest, <80% LVR
1.99% p.a.variable for 12 months and then 2.48% p.a. variable
2.47% p.a.
A super low introductory rate home loan with no monthly or ongoing fees. Unlimited free redraws and unlimited additional repayments to help you build your equity and own your home sooner. Multiple loan splits available. (Rates revert after introductory period ends). 20% minimum deposit required.
Go to siteCompare2.34% p.a. variable
2.34% p.a.
UHomeLoan - Discount Offer
Owner Occupier, Principal & Interest
2.34% p.a. variable
2.34% p.a.
Enjoy a super low rate, $0 fees and easy application with the Mozo Experts Choice Home Lender Bank of the Year.^ Free redraw with flexible repayments. Min 20% deposit.
Go to siteCompare2.19% p.a. variable
2.19% p.a.
Celebrate Variable Home Loan
<60% LVR, Owner Occupier, Principal & Interest
2.19% p.a. variable
2.19% p.a.
Fast online application with no fees. Free extra repayments and redraw facility. Min 40% deposit. Crowned Best New Home Loan for 2020 by the Mozo Experts.^
Go to siteCompare2.04% p.a.
fixed 2 years2.79% p.a.
Special Offer Reward Me Fixed Rate Home Loan
Owner Occupier, LVR <80%, 300k+
2.04% p.a.
fixed 2 years2.79% p.a.
Enjoy $3,000 cashback when you refinance with Virgin Money (T&Cs apply). Additional repayments up to $10,000 per annum. Reverts to the discounted variable rate on expiry of the fixed term.
Go to siteCompare2.09% p.a.
fixed 2 years2.56% p.a.
Basic Home Loan
Fixed, Owner Occupier, Principal & Interest, LVR 70-80%
2.09% p.a.
fixed 2 years2.56% p.a.
Flexible loan structure – create up to six loan accounts with different rate and repayment types. Free redraw from your loan using Macquarie Online.
Go to siteCompare
^See information about the Mozo Experts Choice Home Loans Awards
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