The market for green consumer finance products has grown strongly over the past couple of years and providers are encouraging take-up with attractively priced offers.
Comparison site Mozo reports that it has added 15 green home and personal loans to its database over the past two years.
They include Firstmac’s Green Home Loan. To qualify, borrowers need to provide a Nationwide Energy Rating Scheme (NatHERS) certificate with a minimum 7.0 Star rating for an existing house or one under construction.
The loan is set at a 40 basis point discount to Firstmac’s standard variable rate for the first five years. Currently that is a 2.19 per cent green rate reverting to 2.59 per cent.
Firstmac’s green funders include the Clean Energy Finance Corporation, which is also providing funds for Bank Australia’s Clean Energy Home Loan.
The current Clean Energy Home Loan rate of 2.30 per cent is 20 bps below Bank Australia’s basic owner occupier home loan rate of 2.5 per cent. It reverts to the standard variable rate after five years.
Mozo said rate discounts are a common feature of green finance marketing.
Commonwealth Bank’s Green Loan allows existing CBA home loan customers to fund up to $20,000 of solar panels and other eligible clean energy products for their homes. The rate is 0.99 per cent fixed for the 10-year life of the loan.
Mozo said some of the other products that are potential money savers include Community First Credit Union’s green personal loan, which can used to purchase environmentally friendly products. The 3.99 per cent rate on the loan is the lowest personal loan rate in the Mozo database.
Illawarra Credit Union is selling a green car loan with a variable rate that is currently 3.99 per cent. It is the cheapest car loan rate in the Mozo database.
Other green loan providers include Bank First, Australian Military Bank, Brighte, Community First Credit Union, Endeavour Mutual Bank and Regional Australia Bank.
The ranks of green consumer finance providers continue to grow. Earlier this month, Plenti Group launched a range of electric vehicle finance products, including a financing deal with Tesla. The EV loan rates will be at least 50 basis points lower than non-EV car loans.