As lenders, we have the privilege of handing members the keys to their new home. We advocate for them and celebrate their success. However, our responsibility to their financial well-being doesn't end when the ink dries on the closing documents.
Utility costs are soaring, with no signs of slowing down. For many of our neighbors, especially the ALICE population (Asset Limited, Income Constrained, Employed), simply keeping the lights on and the family warm has become a significant financial hurdle.
If our vision is a world in which everyone thrives, we have to look past the acquisition cost and focus on the day-to-day operational cost of a home. Empowering members to make energy-efficient upgrades is one of the most direct ways we can protect their financial well-being, since it lowers their utility costs and frees up income they can reinvest into their futures.
Learning From the Community
Our perspective on this has been deeply shaped by our work with community organizations. Habitat for Humanity of Michigan, a close partner of Lake Trust Credit Union's, helped us uncover invaluable data on "high-performance" homes.
When a family moves into a home built with modern energy standards, their utility bills are often less than $85 a month. Contrast that with a standard, older home of the same size in the same neighborhood, where winter bills can easily climb to $350-400. That is a $250-plus monthly variance.
For a wealthy borrower, $250 is a dinner out. For the ALICE population, it is the difference between paying off a loan and sliding into delinquency. When we fail to address the energy efficiency of a home, we are effectively ignoring a $3,000 annual drain on the borrower's budget.
In the 2026 housing market, inventory is still tight, prices remain high and the cost of living is only climbing. We cannot control the weather, nor political tides, nor global energy markets. But we can control how we lend.
The Gap
Up until the end of 2025, federal clean-energy tax credits empowered many homeowners to reinvest in their homes, upgrading aging windows, insulation and HVACs, and installing heat pumps, battery storage and solar panels.
Now, with several of those key incentives having expired on Dec. 31, we are facing a new environment. The need for upgrades hasn't disappeared; the seasons are as demanding as ever. But the financial bridge to achieve them has officially narrowed.
The families living in inefficient homes are now stuck in a liquidity catch-22. They can't afford the upfront cash for a renovation without tax credits, but they also can't afford the monthly bleed of high utility rates.
Where Credit Unions Come In
Where others might see a market contraction, credit unions like Lake Trust have a chance to fill that void. If we strategically finance energy upgrades, we can help move money from the utility's ledger back into our members' pockets.
A homeowner who uses their equity to install heat pumps, upgrade insulation or add solar battery storage directly improves their cash flow, making them a stronger borrower and a more financially secure member. A green lending product should recognize that lower risk profile through tangible benefits like rate discounts or flexible terms.
But offering the right product is only half of it. To truly practice inclusivity, we need to embrace alternative data in underwriting, such as rental history, utility payments and telecom bills. If a member has successfully managed the high operating costs of an inefficient rental, they are a fantastic bet for a loan that will drastically lower that monthly expense.
By using data to widen our circle of approval, we extend the benefits of green lending to the people who will gain the most from it.
When we support energy-efficient upgrades, we strengthen the housing stock of our neighborhoods, we keep money in our local economies rather than sending it to utilities, and we help our members build more financially sustainable lives.
If we want to protect our portfolios and our communities, we have to underwrite the whole house, utility bill included.
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