European banks will soon factor climate risk into mortgage lending decisions
Aalto University researchers interviewed green finance experts to find that European lenders now consider energy ratings and future climate risks when issuing mortgages.
Energy ratings impact loan access
Poor energy performance currently makes it harder for borrowers to secure financing. High energy ratings help owners access green lending or other financial benefits. This shift became central in 2020 when new EU Taxonomy rules took effect.
Future criteria will expand
Experts say loan terms will depend on a wider range of environmental sustainability criteria over time. Flood and other climate-related risks are expected to play a greater role in lending decisions soon. The study was published in the Journal of European Real Estate Research.
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