Interest Free Loans for Energy Conservation
17th Sept 2024
A new lifetime loan offer has been introduced, alongside an existing interest free loan for energy conservation works.
To support the government's plans to combat climate change there are a range of financial incentives in place to assist households improve the energy efficiency of their home.
Under the Ma Prime Renov grant regime, grants of up to 90% are available for households on the lowest incomes. Lower grant levels apply for those in higher incomes.
To fill the funding gap between a grant and the cost of the works, applicants can also obtain an interest-free loan, subsidised by the government.
The principal loan facility is called Eco-Prêt à Taux Zero, also known as Mon éco-PTZ Prime Réno.
This loan is available to all households, without any test of resources, subject to the bank being satisfied that you will be able to repay the loan. The loan is available for 15 years, which can be increased to 20 years in the case of a substantial package of works leading to an major improvement in energy efficiency.
The maximum amount available is €50,000, but the size of the loan depends upon the extent of the works. Only in the case of complete upgrading of the energy efficiency of the property is the maximum sum available.
There is a cap on some elements of work, such as €7,000 for the installation of double glazing, a sum that is likely to be well below actual costs for most households.
The loan can also be used to fund the installation of a septic tank, which is also capped, at €10,000 .
In support of those households whose income would not support loan repayments, the government have also introduced a separate loan facility, called Prêt Avance Mutation (PAM).
The great advantage of the PAR is that it does not need to be repaid until sale of the property, either as a result of moving home or following death of the owner and subsequent sale of the property.
Unlike the eco loan, the PAM is subject to a test of resources. For a couple, the maximum eligible annual income is €31,889 (€42,058 in the Ile de France). For a single person the threshold is €21,805 (€28,657 Ile-de-France). The thresholds are increased for children.
The maximum load is €50,000, with the same restrictions that apply on the Eco-PTZ. Eligible works are also the same, including the installation of a septic tank.
Interestingly, however, it is possible to accumulate both loans, although not for the same works.
The loan is also interest free for the first 10 years, after which a standard rate of interest fixed by the lender will then apply.
Both loans are only available if the property is the principal residence of the applicant.
The loans are available from most retail banks in France to whom enquiries should be made.