Mortgage Rates in California and Energy Saver Loan Option
California’s housing market continues to evolve, and in 2025, the savvy homebuyer is no longer just thinking about square footage and neighborhood vibes—they’re also asking the right financial and environmental questions. Two hot topics leading the way: understanding the average interest rate for mortgage in California and exploring innovative financing like the energy saver home loan program.
If you’re buying or refinancing in California, here’s what you need to know.
The Average Interest Rate for a Mortgage in California
As of June 2025, the average 30-year fixed mortgage rate in California hovers around 6.9%, in line with national averages. That said, your personal rate can vary based on factors like:
Credit score
Loan amount and type
Down payment size
Lender policies
While 6.9% may feel high compared to the sub-4% rates of the past, it’s consistent with broader market trends as the Fed keeps inflation in check. Shopping around for lenders and considering options like 15-year mortgages or adjustable-rate mortgages (ARMs) could help reduce your interest over time.
Why Energy-Efficient Financing Matters
As utility prices climb and climate concerns rise, energy-efficient homes are becoming more than just a trend—they’re a necessity. Fortunately, California leads the way with multiple energy saver home loan programs that make upgrading affordable and accessible.
These programs not only reduce your carbon footprint but also lower monthly energy bills, increase property value, and may even qualify you for tax benefits.
Energy Saver Home Loan Program Options in California
1. GoGreen Home (by CAEATFA)
Offered through the California Hub for Energy Efficiency Financing, GoGreen Home partners with private lenders to offer credit-enhanced loans for energy upgrades.
Eligible projects include:
Solar panels and battery storage
HVAC systems
Heat pump water heaters
Insulation, windows, and air sealing
Best of all, these loans are accessible even for renters and multi-family property owners.
2. Energy Efficient Mortgage (FHA-EEM)
For those using FHA loans, this federal program allows you to roll energy-efficiency improvements into your mortgage. Great for first-time buyers looking to invest in long-term savings.
3. PACE Financing (HERO Program)
Offered in many California counties, PACE allows homeowners to finance green upgrades and repay the cost through property tax assessments. While innovative, PACE loans can affect refinancing and selling, so read the fine print.
4. Self-Help Federal Credit Union Energy Saver Loans
This California-based credit union offers low-interest loans specifically for energy upgrades like appliances, air sealing, and efficient heating systems.
5. Utility-Sponsored Financing (e.g., PG&E 0% Loans)
Some major utilities offer interest-free loans for equipment like energy-efficient furnaces, water heaters, and heat pumps.
Why Pairing Mortgage Strategy with Green Financing Pays Off
If you’re buying a home in 2025, consider this approach:
Lock in the best possible mortgage rate by improving your credit and comparing lenders.
Use an energy-efficient loan program to offset renovation costs and reduce monthly bills.
Invest in upgrades that boost your home’s value and sustainability (think: solar, heat pumps, EV chargers).
Over time, the combination of smart borrowing and energy savings can significantly improve your financial and environmental return on investment.
Final Thoughts
From understanding the average interest rate for mortgage in California to choosing the right energy saver home loan program, California homeowners have powerful tools at their disposal. Whether you’re a first-time buyer or refinancing your forever home, aligning your financing with your values is no longer just possible—it’s the smartest move you can make in 2025.