The Eco Loan for "green" Home Improvements
What is the Eco Loan for "green" Home Improvements?
Replacing you old boiler, installing solar panels or putting in roof insulation: these are all environmentally-friendly investments that will help you save money later on. You can now finance work of this kind via an Eco Loan, with the benefit of a favorable interest rate and a tax incentive.
It is a conventional personal loan with a more favorable rate of interest that can only be used for funding the following:
- replacement and maintenance of old boilers;
- installation of a solar-powered hot water system;
- fitting of photovoltaic panels to convert solar energy to electricity;
- installation of other equipment designed to produce geothermal energy;
- fitting double glazing;
- roof, ground and wall insulation;
- installation of thermostatic valves or a timer-based room thermostat;
- arranging an energy audit of your home.
This renovation and installation work is subsidised by the State pursuant to the Grand-Ducal Regulation of 20 April 2009.
- Favourable interest rate: you qualify for a smaller interest rate than that on a standard personal loan;
- economical: saving energy means saving money, and you pay no handling charge either;
- quick: you obtain your loan quickly, so you can start your improvements directly without drawing on your savings;
- environmentally friendly: you reduce your ecological footprint;
- tax: if you are a Luxembourg taxpayer or the equivalent, you can deduct the debit interest, up to an amount of EUR 336 for each member of your household for tax purposes, as well as the debt balance insurance premiums associated with this loan, from your taxable income.
A comprehensive list of the subsidised investments is available on www.myenergy.lu, together with a host of energy-saving tips.
Often you hear people say: “Anyway, until I have paid off my home loan it’s the bank who owns my house”. But is it true?
It is always the same question that every one of us is asking before signing a home loan with his bank. To gain a more objective overview, let’s analyse them one by one with their respective advantages and disadvantages.
The rate remains fixed for a pre-defined period and, at the end of the period, is subject to a revision. The pre-defined period can vary from one bank to another but is generally 3, 5 or 10 years.
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