Buying a home is one of the biggest financial decisions most people will ever make. But what if your home loan could do more than help you purchase a property? What if it could also reward you for making a more sustainable choice?

A green home loan is designed to encourage homeowners to invest in highly energy-efficient properties. With the APS Green Home Loan, eligible customers can benefit from a discounted interest rate while contributing to a more sustainable future.

Whether you are buying your first home, upgrading to a new residence, or transferring an existing home loan from another bank, understanding how a green home loan works could help you make a smarter long-term decision.

Key Takeaways

  • A green home loan rewards buyers of highly energy-efficient homes.
  • The APS Green Home Loan offers a fixed interest rate of 1.50% for the first five years for eligible properties.
  • Energy-efficient homes can help reduce utility bills and environmental impact.
  • Existing homeowners may qualify if their property meets the required EPC (Energy Performance Certificate) criteria.
  • Homeowners with loans at another bank may be able to switch to APS Bank and benefit from the APS Green Home Loan.

What Is a Green Home Loan?

A green home loan is a type of home loan that supports the purchase or financing of highly energy-efficient properties. But what makes a home energy efficient?

In Malta, an energy-efficient home may include features such as:

  • Solar panels (PV systems) to generate its own electricity
  • Good insulation to help keep the home cool during summer and reduce the need for air conditioning
  • Double-glazed windows to minimise heat entering the property
  • Efficient cooling systems, such as modern air-conditioning units or heat pumps
  • Solar water heaters to reduce electricity used for hot water

These features help lower overall energy consumption, reduce carbon emissions and improve a property’s Energy Performance Certificate (EPC) rating. Homes with an eligible EPC rating may qualify for the APS Green Home Loan, subject to the Bank’s eligibility criteria.

Unlike a standard home loan, a green home loan rewards homeowners who invest in properties that are designed to be more energy efficient and environmentally friendly. As environmental awareness continues to grow in Malta, more homebuyers are looking for ways to make their homes both financially and environmentally sustainable, and a green home loan can help achieve both goals. If you’re new to the concept, you may also want to explore our guide on the benefits of green home loans, which explains how energy-efficient homes can help reduce energy consumption, lower utility costs and support a more sustainable future.

Why Is a Green Home Loan Important?

Energy-efficient homes are becoming increasingly valuable. They are designed to reduce energy consumption, lower carbon emissions and improve long-term sustainability.

Choosing a green home loan offers several advantages:

Lower Energy Costs

Highly efficient homes often require less energy for heating, cooling and everyday living. This may lead to lower utility bills over time.

Environmental Benefits

Homes that use less electricity for cooling, heating and appliances produce fewer carbon emissions and place less demand on energy resources. By investing in an energy-efficient home, homeowners can help reduce their environmental impact while contributing to a more sustainable future.

Future-Proofing Your Property

As energy efficiency standards continue to evolve, homes with strong environmental credentials may become increasingly attractive to future buyers.

Financial Incentives

One of the biggest benefits of a green home loan is that eligible borrowers can benefit from more favourable financing terms than a standard home loan. With the APS Green Home Loan, qualifying customers can benefit from a discounted fixed borrowing interest rate of 1.50% p.a. for the first five years, rewarding their investment in a highly energy-efficient home.

In addition to the benefits offered by APS Bank, homeowners may also be able to take advantage of government initiatives that encourage more sustainable housing. Depending on eligibility and the schemes available at the time of application, support may be available for purchasing an energy-efficient home or carrying out energy-efficient renovations.

Examples include:

As government schemes may be updated from time to time, it is advisable to check the latest eligibility criteria and application details with the Building and Construction Authority (BCA) or the relevant government authority.

APS Home Loan vs APS Green Home Loan

When comparing a traditional home loan with the APS Green Home Loan, the main difference lies in the sustainability incentive. A standard home loan helps finance the purchase of a property. The APS Green Home Loan goes one step further by rewarding customers who choose a highly energy-efficient home.

Eligible applicants can benefit from:

  • A fixed borrowing rate of 1.50% p.a. for the first five years
  • Potential long-term savings on interest costs
  • Lower energy bills through ownership of an energy-efficient property
  • A more sustainable way of living by reducing energy consumption, lowering carbon emissions and helping preserve energy resources for the future.

This makes the APS Green Home Loan an attractive option for environmentally conscious homeowners looking to save money while making a positive impact.

How Does the APS Green Home Loan Work? 

The APS Green Home Loan is available for a customer’s main and primary residence, with a maximum loan amount of €500,000. To qualify, the property must meet specific Energy Performance Certificate (EPC) requirements:

  • Energy Use Rating of 25 or below
  • Carbon Dioxide Emissions Rating of 6 or below
  • Equivalent to EPC ratings of A or A+

If your property already meets these requirements, you may qualify for the APS Green Home Loan and benefit from a discounted fixed borrowing interest rate of 1.50% p.a. for the first five years, subject to the Bank’s assessment and approval.

Planning to purchase a property that isn’t yet energy efficient? You may still be eligible. Customers who intend to upgrade their property to meet the Green Home Loan’s energy efficiency and sustainability requirements within the first two years of the loan may also qualify, subject to APS Bank’s assessment and the applicable eligibility criteria.

Eligibility for the APS Green Home Loan is confirmed during the application process, including an assessment of your property’s EPC rating and your loan application.

Why APS Bank Supports Green Home Loans

Sustainability is one of the core pillars of APS Bank. The APS Green Home Loan was created to encourage responsible homeownership and reward customers who choose environmentally sustainable properties.

By offering preferential rates on qualifying properties, APS Bank aims to make sustainable living more accessible while helping customers reduce both their environmental footprint and long-term borrowing costs.

If you are considering purchasing an energy-efficient home or want to see whether your existing property qualifies, book an appointment with our team to find out how much you could save with the APS Green Home Loan.

FAQs

What is a green home loan?

A green home loan is a home loan designed for highly energy-efficient properties, often offering favourable financing terms to encourage sustainable living.

What is the APS Green Home Loan?

The APS Green Home Loan is a home loan offered by APS Bank that provides a fixed borrowing rate of 1.50% p.a. for the first five years for eligible properties.

How do I qualify for the APS Green Home Loan?

Your property must have an eligible Energy Performance Certificate (EPC) rating, including an Energy Use Rating of 25 or below and a Carbon Dioxide Emissions Rating of 6 or below.

Can I switch my existing home loan to APS?

Yes. Customers with a qualifying property and an existing home loan at another bank may be able to transfer their loan to APS, subject to approval.

Is a green home loan only for new properties?

Not necessarily. Existing properties may qualify if they meet the required EPC criteria.

What is an EPC?

An Energy Performance Certificate (EPC) measures the energy efficiency and environmental performance of a property.

Are green home loans available in Malta?

Yes. APS Bank offers a green home loan solution for eligible properties.

Can a green home loan help me save money?

Potentially yes. Qualifying borrowers may benefit from a lower fixed interest rate and lower energy costs associated with an energy-efficient home.

A Representative Example of the APS Green Home Loan

On a fully utilised APS Green Home Loan of €300,000 at a fixed borrowing interest rate of 1.50% p.a. for the first 60 months and a variable borrowing interest rate of 2.90% p.a. for the remaining 360 months, the Annual Percentage Rate of Charge (APRC) will be 2.6%* p.a.

The loan will be repayable in 60 equal monthly instalments of €921.62. Followed by 360 equal monthly instalments of €1,114.05 over a term of 35 years. Therefore, the total sum payable throughout the term of the loan will be €456,504.85 being:

  • €300,000 capital
  • €156,354.85 interest
  • €150 booking fee

The total sum payable throughout the term of the loan if the fixed rate was not available would be €480,721.42 (no booking fee is charged for a Variable Rate Home Loan). Therefore, you will save up to €24,216.57 in interest with our APS Green Home Loan solution. Any deviations from the assumptions could impact the APRC of the product.

Assumptions in the APRC calculation   

The assumptions in the above APRC calculation are based on the following:

  • The consumer lending bank base rate (currently at 2.25%) remains unchanged during the variable borrowing interest period of the loan.
  • No loan prepayments are done during the first 60 months. The loan is repaid as scheduled for the full duration of the facility.
  • The facility is utilised in full within the first 3 months after being sanctioned.
  • A processing fee (0.25% of the loan amount) will be collected at the time of issuing the sanction letter. This will be refunded in full at the time of signing the contract.
  • Bank legal fees (0.325% of the loan amount + VAT) will be waived for first time home buyers.
  • The credit agreement is to remain valid for the period agreed between the Bank and the consumer, and that both parties will fulfil their obligations under the term and by the dates specified in the credit agreement.
  • The APRC calculation is based on the total cost of the credit to the consumer, expressed as an annual percentage of the total amount of credit.

The worked example does not include the following items since such costs cannot be determined in advance:

  • A life assurance policy covering the amount of the facility and a building replacement policy which are to be pledged in favour of the Bank.
  • Periodic updating of searches since such fees would incur Public Registry and Lands Registry fees.

Life and property insurance are obligatory in order to obtain the loan. The loan is to be secured by a first ranking general and special hypothec and special privilege over the property being financed in Malta, a first ranking pledge over a life assurance policy covering the whole loan amount and a buildings insurance policy for the replacement cost of the property being end-financed. In the event of non-observance of the terms and conditions, including non-adherence to the loan repayments, the bank may take steps to sell the property financed, following legal proceedings, and you may lose the property.

Approved and issued by APS Bank, APS Centre, Tower Street, Birkirkara BKR 4012, Malta. APS Bank plc is regulated by the Malta Financial Services Authority as a Credit Institution under the Banking Act 1994 and to carry out Investment Services activities under the Investment Services Act 1994. The Bank is a participant in the Depositor Compensation Scheme established under the laws of Malta. Applications are subject to the Bank’s lending criteria. Terms and conditions apply and are available on request.