Consumers could save thousands of dollars on mortgages if they take steps to make your home greener by switching to solar panels.
Finder head of consumer relations, Graham Cooke said to News.com.au: “Green banking is a movement which is really being pushed by the public – Australians are wanting to make more choices that are more beneficial to the environment and invest less in things like fossil fuel companies and banks are kind of adjusting their offer to cater for those Australians.
He said that banks offer lower interest rates on their home loans if consumers build homes with ‘green functions’ and that you can either install solar panels on your roof or electrify your home to meet the national housing energy scheme standards.
Research by Finder shows that you could save up to $6,000 a year if you make your home greener.
He does note that the trend is more suited to those looking to build a home rather than making existing properties environmentally friendly and that some people don’t have the ability to install solar panels. He says it depends on the construction of your roof and whether your house is shaded by a lot of trees and if the householder has the finances to install them.
Consumers may also qualify for green loans for electric vehicles or other loans.
Bank of Australia was the first bank to offer discounted green home loans to its customers in 2020. Its customers could save up to 0.3 per cent on their home loan.
The next bank to jump onboard with the initiative was Commonwealth Bank who launched “CommBank Green Loan which gives a 2.49 per cent standard variable rate compared with 5.31 per cent, which is a saving of 2.81 per cent.
Switching to a green home loan on an average-sized loan of $611,158 could save you between $5848 and $43,286 over a five-year period.
Mr Cooke warned customers that they should get direct quotes because advertised rates can sometimes be inflated to look artificially high.
With economists predicting another cash rate increase of 50 basis points today, any discount is likely to be a relief for mortgage holders.
Neither ANZ, NAB or Westpac currently offer green home loans.Westpac does have a special offer for customers purchasing an electric vehicle.
Head of Strategy, Product and Pricing, Consumer Finance at Westpac, Joel Larson said to News.com.au: “There are lots of Australians weighing up whether to go green with their next car purchase and we know cost is one of the biggest barriers; we hope our offer will help more customers make the switch to a greener vehicle.”
Gateway Australia, loans.com.au and Firstmac are amongst the smaller lenders to offer green home loans.