6 Green Loans to Finance Your Remodel

Green loans help pay for eco-friendly home improvements. Compare personal loans with other financing options.

Annie Millerbernd
Written by
Last updated on December 18, 2023
Edited by
✅ Fact checked and reviewed
Kim Lowe
Edited by
✅ Fact checked and reviewed

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SoFi Personal Loan
SoFi Personal Loan
SoFi Personal Loan
5.0
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SoFi offers online personal loans with consumer-friendly features for good- and excellent-credit borrowers.

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6 Green Loans to Finance Your Remodel

Lender
NerdWallet Rating
Est. APR
Loan amount
Min. credit score
Learn more
SoFi

SoFi Personal Loan

Visit Lender
on SoFi's website
on SoFi's website
Check Rate
on NerdWallet
on NerdWallet
View details
Best for Green loans
Rate discount

8.99-29.99%

$5,000-$100,000

None

Upgrade

Upgrade

Top 3 most visited 🏆
Visit Lender
on Upgrade's website
on Upgrade's website
5.0
/5
Best for Green loans
Rate discount

8.49-35.99%

$1,000-$50,000

560

5.0
/5
Best for Green loans
Fast funding

7.99-24.99%

$2,500-$40,000

660

4.5
/5
Best for Green loans
Fast funding
Flexible payments

7.80-35.99%

$1,000-$50,000

None

4.5
/5
Best for Green loans
Rate discount

6.99-25.49%

$5,000-$100,000

660

Prosper

Prosper

Check Rate
on NerdWallet
on NerdWallet
4.5
/5
Best for Green loans

8.99-35.99%

$2,000-$50,000

560

Our pick for

Green loans

SoFi
Visit Lender
on SoFi's website
on SoFi's website
SoFi

SoFi Personal Loan

Est. APR

8.99-29.99%

Loan amount

$5,000-$100,000

Min. credit score

None

Upgrade

Upgrade

Est. APR

8.49-35.99%

Loan amount

$1,000-$50,000

Min. credit score

560

Upstart

Upstart

4.5
Est. APR

7.80-35.99%

Loan amount

$1,000-$50,000

Min. credit score

None

Lightstream

LightStream

Est. APR

6.99-25.49%

Loan amount

$5,000-$100,000

Min. credit score

660

Discover

Discover® Personal Loans

Est. APR

7.99-24.99%

Loan amount

$2,500-$40,000

Min. credit score

660

Prosper

Prosper

Est. APR

8.99-35.99%

Loan amount

$2,000-$50,000

Min. credit score

560

» MORE: Best home improvement loans

Green loans from online lenders

Some online lenders refer to loans you use for energy- and water-saving home improvements as "green loans." These are unsecured personal loans you use to pay for large-scale projects that might include:

  • Weatherization.

  • Bath or kitchen remodels that incorporate sustainable materials.

  • Double- or triple-pane window installation.

  • Water-efficient plumbing.

  • Low-VOC floors, coverings with low volatile organic compounds.

Aside from how you use it, a green loan from an online lender resembles any personal loan: Annual percentage rates are from 6% up to 36%; loan amounts range from $1,000 to $100,000; and they’re repaid in fixed monthly installments, typically over two to seven years.

To qualify for the lowest rates, borrowers generally need good to excellent credit (scores above 690), low debt and enough income to cover existing expenses plus the new loan payment.

How to get a green loan

Getting a green loan from an online lender is the same process as for any personal loan. Here are the main six steps.

  1. Check your credit reports. Review your credit report to spot errors that could be keeping your credit score down. If you address them before you submit a loan application, you’ll improve your chance of qualifying. You can see your credit report for free with NerdWallet or at AnnualCreditReport.com.

  2. Estimate the project costs. Have a reliable estimate before you start looking into financing options. A personal loan comes in a lump sum, so if you don’t borrow enough, it’s difficult to reapply for more.

  3. Calculate monthly payments. Use a home improvement loan loan calculator to see how the new loan fits into your budget. A calculator shows what rate and repayment term you’ll need on the loan in order to afford the monthly payments.

  4. Compare lenders. It’s typically best to choose the lender that offers the lowest APR. You can also compare loan features like how fast lenders send funds, whether they allow joint or co-signed loans and what kinds of credit-building tools they offer.

  5. Pre-qualify. Many online lenders let you pre-qualify to see what rate, term and loan amount you could be offered without affecting your credit.

  6. Gather documents and apply. If you go with an offer you’ve pre-qualified for, you’ll move to the application process. A lender may ask for information like W-2s, pay stubs and your Social Security number, so have those documents on hand before you apply. Submitting an application will trigger a hard credit pull.

Other green loan options

Credit union loans

You may receive a discounted interest rate on a green loan from your local credit union. Colorado-based Elevations Credit Union, for example, offers an energy loan that finances updates like solar panels and energy-efficient appliances. Velocity Credit Union in Austin, Texas, has financing for energy-efficient home improvements through a partnership with the local utility company. Both loans have low starting rates.

Government funding

Federal, state and local governments may offer assistance to make your home more energy- or water-efficient. The Department of Housing and Urban Development offers FHA Title 1 Loans and 203(k) loans.

Low-income consumers can get help like energy bill assistance, weatherization resources, repairs and crisis aid through the Low Income Home Energy Assistance Program. You can find more information about local options at your utility company or by using the Department of Energy’s weatherization database.

Home equity

If you have enough equity in your home, you may be able to borrow it to pay for a green home improvement project. Home equity loans come in lump sums and are repaid in fixed installments, typically over five to 15 years.

With a home equity line of credit, you use as much of the money as needed and repay only what you use. HELOCs have variable rates and repayments over a longer term — often 20 years. Using equity typically means securing the loan with your home, which the lender can take if you don’t repay.

Credit cards

Credit cards are best used for small, DIY projects. Contractors may charge a small fee if you pay with a credit card. You could get cash back on your purchases with a store card from a retailer you plan to frequent during the remodel. Just pay off the balance to avoid having interest costs outweigh the rewards.

Last updated on December 18, 2023

Methodology

NerdWallet’s review process evaluates and rates personal loan products from more than 35 technology companies and financial institutions. We collect over 50 data points from each lender and cross-check company websites, earnings reports and other public documents to confirm product details. We may also go through a lender’s pre-qualification flow and follow up with company representatives. NerdWallet writers and editors conduct a full fact check and update annually, but also make updates throughout the year as necessary.

Our star ratings award points to lenders that offer consumer-friendly features, including: soft credit checks to pre-qualify, competitive interest rates and no fees, transparency of rates and terms, flexible payment options, fast funding times, accessible customer service, reporting of payments to credit bureaus and financial education. Our ratings award fewer points to lenders with practices that may make a loan difficult to repay on time, such as charging high annual percentage rates (above 36%), underwriting that does not adequately assess consumers’ ability to repay and lack of credit-building help. We also consider regulatory actions filed by agencies like the Consumer Financial Protection Bureau. We weigh these factors based on our assessment of which are the most important to consumers and how meaningfully they impact consumers’ experiences.

NerdWallet does not receive compensation for our star ratings. Read more about our ratings methodologies for personal loans and our editorial guidelines.

To recap our selections...

NerdWallet's Green Loans to Finance Your Remodel

  • SoFi Personal Loan: Best for Green loans
  • Upgrade: Best for Green loans
  • Upstart: Best for Green loans
  • LightStream: Best for Green loans
  • Discover® Personal Loans: Best for Green loans
  • Prosper: Best for Green loans

Frequently asked questions

  • A green loan is a personal loan you use to pay for a remodel that incorporates sustainable materials, appliances or practices. Some lenders that offer this type of financing have special rates and terms on home improvement loans.

  • Like other unsecured loans, you qualify for a green loan mostly based on your creditworthiness and finances. Borrowers with excellent credit (720 or higher FICO), high income and little other debt will qualify for the best rates on a green loan.

    Learn more about how to get a personal loan.

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