A few short months after its introduction to eco-conscious Aussies and Bank Australia’s Clean Energy Home Loan has been awarded the inaugural 2020 Mozo Experts Choice Award for best Green Home Loan.
Every year our team of experts sift through reams of data to determine which Australian banking products are not only offering the most competitive rates, but also the most useful features and this year was no exception. For the 2020 Mozo Experts Choice Home Loan Awards we compared a whopping 436 home loans from 86 different lenders.
Mozo’s banking expert Peter Marshall said, “With the growing number of eco-conscious Australians, this year we added the Green Home Loan award to our repertoire. This award is designed not only to help house hunters find a low cost eco-friendly loan, but also to encourage buyers to think green when choosing a forever home.”
Green Home Loan award criteria
The award only considered home loans strictly available to borrowers looking to purchase a more environmentally friendly property. This means homes with a minimum defined level of environmental efficiency. Other criteria included the ability to make principal and interest payments, a variable interest rate and a loan to value ratio of 80% (LVR).
Bank Australia’s award-winning green home loan
Introduced this January, Bank Australia’s Clean Energy Home Loan pretty much offers all the same features as the bank’s Premium Home Loan Package, but with the added bonus of a 0.40% interest rate discount. The discount applies either for the fixed interest rate duration or for the first five years of a variable interest rate loan, granted your future home has one of the following eco-friendly certifications:
- A 7 stars or higher rating under the Nationwide House Energy Rating Scheme Certificate (NatHERS).
- A Residential Efficiency Scorecard with a rating of 7 stars or more (excludes the impact of installed/installing rooftop solar).
- Passive House Certification.
- Green Star, Design & As Built score of 8 points or more on the credit ‘15 Greenhouse Gas Emissions.’
With this home loan you can put down a deposit from as much as 30% to as little as 10%, just keep in mind that anything less than 20% will likely incur Lenders Mortgage Insurance.
Variable rates start as low as 2.98% p.a. for loans between $150,000 and $499,999 with an LVR between 70% and 90% (3.59% p.a. comparison rate*).
As this is a premium home loan package it does come with an annual service fee of $350. This covers the cost of extra perks such as a Mortgage Offset account, the ability to make fee free extra repayments, a free redraw facility and the option to split your loan - paying one portion with a guaranteed fixed interest rate and the other with variable interest rate.
Other unique features of the home loan include an ‘eco-pause’ and a ‘parental pause.’ So if you’re planning to make eco-upgrades to your home, such as solar or battery installations or you’re about to become a parent, then you may be able to pause principal repayments for three or six months. Just bear in mind that you will still have to pay the relevant interest owed during the pause period.
Bank Australia’s ethos
You may know Bank Australia from its widespread marketing campaign. On top of being carbon neutral since 2011, Bank Australia makes a point of not investing in harmful industries including the fossil fuel industry, live animal exports, gambling and the arms industry.
It was also the first Australian bank to have its deposit and home lending products certified as responsible by the Responsible Investment Association of Australasia. This certification means that the bank takes a stricter approach when assessing potential borrowers’ ability to make loan repayments without falling into financial hardship.
Interested to read more about the awards? Why not head to the Home Loans Awards page for a full list of the Mozo Experts Choice Award winners and more information on what criteria is used to pick them. Or if you’re still searching for a home loan, feel free to take a look at the options on offer below.
Compare home loans - last updated January 18, 2021
^See information about the Mozo Experts Choice Home Loans Awards
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