Energy-efficient home loan

Bank of Fukuoka lends money for a home that you or your family will occupy, including building, buying a new or existing house or apartment, and renovation. This entry covers its ZEH and LCCM routes for individual borrowers. ZEH homes aim for a zero annual primary-energy balance. LCCM homes reduce carbon from construction, use and disposal, and use renewable energy so that their overall life-cycle carbon balance is negative.

You can borrow JPY 1 million to JPY 200 million, within the money needed for the housing purchase or work and no more than 200% of the land-and-building price. The financing-fee option has a JPY 5 million minimum. Related site works and housing acquisition costs can be included; furniture and appliances are subject to the bank's own amount limits. The term can be up to 50 years, with additional restrictions for existing apartments. A fully fixed rate is unavailable for terms of 36–50 years.

You repay the loan and interest through equal monthly payments. Up to 50% of the loan can be allocated to larger payments at bonus times. The guarantee company takes a first-ranking mortgage over the financed property, meaning it has the first secured claim against that property. You pay the mortgage-registration costs and long-term fire-insurance premiums. The bank pays the premiums for its mandatory standard group credit-life insurance. A personal guarantor is normally unnecessary, but the guarantee company may require one depending on the property.

There are three guarantee-cost options. With an upfront guarantee, you pay a JPY 55,000 guarantee-company charge plus a guarantee premium determined by the loan amount, term and assessment. With the interest-included guarantee, you pay the JPY 55,000 charge and an interest rate 0.2 percentage points above the upfront-guarantee rate, without paying the guarantee premium upfront. The financing-fee option charges 2.2% of the amount borrowed, including the JPY 55,000 charge, and requires no upfront guarantee premium. The latter two options may be unavailable following the guarantee company's assessment. These fees include consumption tax.

The bank offers an initial fixed period of 2, 3, 5 or 10 years, a variable rate, and fully fixed options of 20, 25 or 35 years. For an initial fixed-period loan, the subsequent rate is the bank's applicable base rate minus 1.1 percentage points only if, when you choose your next rate, you still receive salary or pension payments at the bank or are registered for its app or internet banking, and have never had an overdue repayment on this loan. At the end of a fixed period you can choose fixed or variable; without an instruction the loan becomes variable and the payment is recalculated. A fully fixed loan cannot switch rate types.

For the variable option, the rate reduction continues to the end of the loan, but switching to a fixed-period rate ends that reduction. The interest rate is reviewed each 1 April and 1 October, normally applying from July and the following January repayments. Monthly payments stay unchanged for five years while the interest and principal portions adjust, with interest paid first; this changes how much of each payment reduces your debt. Payments are reviewed every five years, with any increase limited to 1.25 times the previous payment.

Switching from fixed to variable after the fixed period is free. Switching from variable to fixed, or renewing a fixed period, costs JPY 5,500. Early repayment during a fixed-rate period costs JPY 33,000 for partial repayment or JPY 44,000 for full repayment; otherwise it costs JPY 5,500 or JPY 22,000 respectively. Full early repayment also incurs a guarantee-company charge of up to JPY 5,500. These fees include consumption tax.