ING's Green Upgrade Loan will offer a five-year fixed interest rate of 3.74% p.a. (comparison rate* 5.16% p.a.) and will be available to borrowers from December 2024.
The loan product will allow homeowners in NSW, Victoria, and the ACT access to between $5,000 and $50,000 to fund sustainable home upgrades with a repayment period of 30 years.
The new program is expected to be worth $150 million and will be supported by up to $75 million from the Clean Energy Finance Corporation's (CEFC) $1 billion Household Energy Upgrades Fund.
"We've designed our Green Upgrade Loan following customer and mortgage broker feedback that the retrofitting process is complex and time consuming," ING Australia CEO Melanie Evans said.
"If we want to accelerate decarbonisation, we need to remove the complexities and barriers that are stopping people from making their homes more energy efficient."
To be eligible for the Green Upgrade Loan, ING customers must hold a home loan balance of at least $150,000 with a loan-to-value ratio (LVR) of 80% or less after the new loan's addition on a property worth no more than $2.5 million.
ING also announced its new Home Energy Helper tool, created via a collaboration with BOOM! Power, on Wednesday.
The tool allows homeowners to receive quotes for energy-efficient upgrades, assess if they're eligible for any grants, and estimate the impact of any planned upgrades on their energy bills and household emissions.
The Home Energy Helper will launch in NSW, Victoria, and the ACT in December and will be available across the rest of the country in early 2025.
How does ING's Green Upgrade Loan compare to others on the market?
The deal between CEFC and ING is the third of its kind, with Plenti and Westpac having previously received Household Energy Upgrades Fund support.
Westpac uses the support to provide its Sustainable Upgrades loan, allowing existing home loan borrowers to access between $4,000 and $50,000 extra to be repaid over 10 years or less.
The Sustainable Upgrades loan advertises a variable rate of 4.49% p.a. (comparison rate* 4.87% p.a.) at the time of writing.
Non-bank personal loan lender Plenti also uses CEFC support to discount rates on its standard green loans to households turning to its network of partners and installers for home upgrades.
Other major lenders also offer add-on loan products to home loan customers upgrading their home with sustainable features, CommBank's Green Loan being one example.
It allows existing CommBank home loan customers to borrow $5,000 to $30,000 extra over a 10-year fixed rate period, with an advertised interest rate of 3.99% p.a. at the time of writing.
Meanwhile, many home loan lenders offer green home loans, providing discounted interest rates to those who own or plan to buy an energy-efficient home, and those who have completed sustainable home upgrades.
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In the market for a green home loan? Find some of the market's most competitive below:
Lender Home Loan Interest Rate Comparison Rate* Monthly Repayment Repayment type Rate Type Offset Redraw Ongoing Fees Upfront Fees Max LVR Lump Sum Repayment Additional Repayments Split Loan Option Tags Features Link Compare Promoted Product Disclosure
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90% LVR
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