Quick answer
An energy efficient upgrade loan funds improvements that cut a property's energy use, such as insulation, glazing, efficient heating and cooling, hot water, draught sealing, LED lighting and solar. Ownright Custom Finance arranges these loans Australia-wide for owners and investors, matching the borrowing structure to the size of the project and your circumstances.
Key points
- Insulation, glazing, hot water and cooling upgrades can be financed
- Smaller projects may suit a personal loan, larger ones a secured option
- Itemised quotes from qualified trades smooth the approval
- Programs and rebates differ by state and change regularly
- Suits
- Owners of older homes, landlords, small commercial owners
- Security
- Unsecured for small projects, property for larger ones
- Typical upgrades
- Insulation, glazing, efficient appliances, solar, shading
- Australia-wide
- Yes
What is an energy efficient upgrade loan?
It is borrowing set aside for improvements that make a property use less energy to stay comfortable. A draughty weatherboard with no insulation will chew through heating in winter and cooling in summer; a tight, shaded, well-insulated home with efficient appliances does the same job on far less. The loan covers the gap between wanting those changes and having the cash to pay for them.
There is no single product with that name. It is a purpose, and the lender behind it might offer a personal loan, a top up on an existing mortgage, a second mortgage or an asset-style facility for equipment. Picking the right one is the broker’s job.
Which upgrades are worth financing?
- Ceiling, wall and underfloor insulation
- Double or secondary glazing, plus curtains and pelmets
- Draught sealing around doors, windows and vents
- Efficient heating and cooling, including reverse-cycle systems
- Heat pump or other efficient hot water systems
- LED lighting and smart controls
- External shading, awnings and reflective roofing
- Rooftop solar and, where it makes sense, a battery (see solar panel loans and home battery loans)
Which ones matter most depends on climate, building age and orientation. A Darwin unit and a Hobart cottage need opposite things, and an assessor or reputable installer can tell you where to start.
How do lenders see an efficiency project?
| What the lender asks | What helps |
|---|---|
| Is the purpose clear? | An itemised quote that lists the products and labour |
| Can the borrower afford the repayment? | Payslips, or tax returns, BAS and bank statements |
| Is the credit history acceptable? | A tidy file, or a clear explanation of past issues |
| Is there security? | A property title, where the sum is larger |
| Is the work done by qualified trades? | Licences and insurance details on the quote |
Our guide to loan serviceability explains how the affordability test is run, and the documents guide lists what to collect.
Personal loan, top up or second mortgage?
For a modest list of jobs, a personal loan often keeps things quick. For a bigger program of work, an extension of the existing mortgage may do the job: see home loan top up. Where the first mortgage cannot be touched, perhaps because of its terms or because the borrower would lose a favourable arrangement, a second mortgage can sometimes sit behind it. If efficiency is one piece of a wider remodel, renovation loans might be the neater home.
Are rebates and incentives available?
Many governments and some energy retailers have funded programs for insulation, efficient appliances, solar and batteries. They differ by state, change often, and come with eligibility rules about the product, the installer and sometimes the household. Because of that, we do not print amounts. Check your state energy department and the national energy website, line up the quote, and let us arrange finance for the real outstanding cost.
How does Ownright help?
Ownright Custom Finance is led by Trevor Scott, who has spent more than four decades in finance. We are not the broker who sends one application to the usual lender and hopes. We ask what you are building towards, whether that is lower bills, a more comfortable home, a rental that is easier to lease or a property ready for sale, and then shape the borrowing around it.
When the standard door is closed, we look for the less obvious one. That might be a lender that reads self-employed income generously, or a security arrangement a bank would not consider. We do this Australia-wide, and we are happy to talk it through before you commit to anything. If you are ready, tell us about the project.
An illustration
Illustrative scenario only. An owner of a 1970s home wants to insulate the ceiling, upgrade windows on the western side and replace an ageing hot water service. The upgrades are quoted by three different trades. A broker could present them as one project with itemised quotes, test whether an unsecured loan or a small top up fits, and stage the work so the hot water goes first if cash flow is tight.
Mistakes to avoid
- Paying for products first and chasing finance afterwards
- Skipping the quote detail, which slows approvals
- Borrowing over a term far longer than the upgrade will last
- Choosing the cheapest installer without checking licences
- Assuming every efficiency claim on a brochure will play out in your house
Documents to have ready
- Itemised quotes with trade licence details
- Photo ID
- Income evidence, such as payslips or tax returns
- A summary of current debts
- A recent rates notice or mortgage statement if security is involved
Reading our loan readiness checklist beforehand makes the process quicker.
Where else might this fit?
Many households combine efficiency work with home electrification loans or move on to green home loans. Small commercial owners can look at business solar finance and green equipment finance. The green finance hub lists every option.
Does the age of the home change the finance?
Older homes tend to have the most to gain from efficiency work, and lenders generally accept that. Heritage listings, asbestos, wiring condition and structural quirks can shape what is practical, and a good tradesperson will flag these before quoting. For lenders, the main interest is that the work is well scoped and priced. A tidy quote from an experienced trade gives more comfort than a rough figure written on the back of a card.
Can renters or tenants use this kind of loan?
Tenants usually cannot borrow for fixed upgrades to a property they do not own, since the landlord decides what is installed. A tenant might still borrow for a portable item such as an efficient appliance, but that sits closer to an ordinary personal loan. Landlords, on the other hand, can often borrow to improve a rental, and sometimes the improvement helps keep the property tenanted. See investment property loans for the wider landlord picture.
How do small commercial owners fit in?
Owners of small shops, offices and workshops can finance efficiency work too, often through an asset-finance structure rather than a home-style loan. Efficient lighting, refrigeration, heating and cooling, and solar all fall into this space. If the project is for a business, the pages on business solar finance and green equipment finance explain how that works, and tax treatment is best checked with your accountant.
Ready to make your property more efficient?
Sounds like you want finance for energy efficient upgrades. We’re the lending experts in this area, so click the button, see if you qualify and let us find the structure that makes the numbers sit right.
How it works, step by step
- 1
Step 1
Pin down the upgrades, ideally after an energy assessment or at least a set of quotes.
- 2
Step 2
We work out how much to borrow and which structure fits the project and your budget.
- 3
Step 3
We approach lenders that are comfortable with improvement and energy projects.
- 4
Step 4
Approval, funds released, and the work goes ahead.
Frequently asked questions
What upgrades count as energy efficient?
Common examples are ceiling and wall insulation, double glazing, draught sealing, efficient heating and cooling, heat pump hot water, LED lighting, window shading and solar. There is no single legal definition for a loan, so lenders mostly care that the work is itemised, done by competent trades and adds to the property.
Do I need an energy assessment before borrowing?
Not usually, but it helps. An assessment can show which upgrades make the biggest difference to comfort and running costs, so you spend where it counts. Lenders rarely require one for a loan, though some government programs do, so check the rules of any scheme you plan to use.
Can I finance upgrades on an investment property?
Yes. Investors can borrow for improvements to rentals, and lenders assess the borrower's total position. The tax treatment of capital works and repairs is a matter for your accountant and the ATO. We can arrange the finance and explain the structures, leaving the tax advice to the right professional.
Will upgrades increase my property's value?
They can, but no lender or broker can promise it. Value depends on the market, the property and the quality of the work. We treat the improvement as a reason for borrowing, not a guarantee of a higher valuation, and size the loan on what you can comfortably repay.
Is a personal loan or a home loan top up better for upgrades?
Neither is better in every case. Personal loans are faster and simpler for smaller sums, while a top up or second mortgage may suit larger projects and longer horizons. The right answer depends on size, speed and your wider borrowing, which is exactly what we discuss at the start.
What if my income is irregular?
Self-employed and contract workers often borrow successfully, usually with tax returns, BAS or bank statements in place of payslips. Different lenders treat irregular income differently, so the approach matters. We pick lenders that read your type of income in the most favourable realistic way.