Self Help Credit Union’s Green Impact Capital

By: Melissa Malkin-Weber - Jan 29, 2016
Source: Self-Help Credit Union

A Pioneering Partnership to Save Energy at Home

In addition to working with individual businesses to support exemplary practices, Self-Help also relishes opportunities to collaborate with other like-minded financial institutions. Our alliance with Craft3 breaks new ground in financing home improvements to amplify positive environmental and community impact.

Craft3, another peer CDFI serving Oregon and Washington, provides home energy-efficiency (EE) loans in partnership with a nonprofit called Enhabit. The program allows a homeowner to finance energy efficiency upgrades, such as insulation, duct-sealing and high-efficiency heat and hot water. A key innovation is that homeowners are able to access financing without putting any money down. They repay the loan through their regular utility bills, a mechanism known as on-bill repayment (OBR). Financed projects aim to reduce the homeowner’s energy use by 15 percent annually. The program also includes a workforce agreement with participating contractors that helps build energy-efficiency expertise among minority- and women-owned businesses.

Craft3 approached Self-Help with a groundbreaking proposition: Would we help establish a “secondary market” for their EE loans? In other words, Craft3 was looking to sell its loans in order to recycle capital and make more loans with the proceeds from the sale.

We jumped at the chance. Together, Craft3 and Self-Help packaged a first-of-its kind transaction, allowing Craft3 to sell its EE loans to Self-Help. Through two loan sales in 2013 and 2015, Self-Help has purchased 1,716 loans originated by Craft3 totaling $22 million. We hope this partnership with Craft3 will help spawn similar programs around the country to bring greater energy efficiency through OBR financing.