Green Mortgages | What are they? How Can I Benefit?

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Today, we’re joined by Ifthi, a trained accountant and mortgage advisor with over 10 years’ experience and a founding director at WIS.

Q1: What are green mortgages?

Gemma: We’ve seen a lot in the news about green mortgages. What are they?

Ifthi:

Green mortgages are part of a shift by both the government and the public towards environmentally friendly housing.

Banks want to reward buyers of energy-efficient properties.

Essentially, a green mortgage is a mortgage product offered to encourage buyers to purchase homes that use less energy.

More banks are introducing these products to incentivize environmentally conscious buyers.

Q2: How do you know if your house qualifies for a green mortgage?

Ifthi:

Banks mainly look at the Energy Performance Certificate (EPC) rating.

Properties in A or B bands generally qualify for green mortgage benefits.

Not all banks offer these products, but the number of lenders providing green mortgages is increasing rapidly.

Q3: Are green mortgages for new or existing properties?

Ifthi:

Currently, green mortgages are mainly for new properties.

Older properties may qualify in the future as demand grows and more products are launched.

Many new builds already include energy-efficient features, so they are likely to qualify.

Q4: How can you make your house more energy-efficient?

Ifthi:

Focus on energy efficiency improvements such as:

• Loft and cavity wall insulation
• Solar panels
• Double or triple-glazed windows
• Energy-efficient boilers

Many new builds already include these features as standard.

Always speak to a broker to confirm whether your property qualifies for a green mortgage product.

Q5: What are the benefits for the borrower?

Ifthi:

Contributing to the environment.

Financial incentives from lenders, such as:

• Discounts on mortgage rates
• Cashbacks (e.g., £200–£250)
• Free evaluations or other perks

Especially helpful for first-time buyers, who often have tight finances.

Q6: Are green mortgages always cheaper?

Ifthi:

Not necessarily. Green mortgages may not always have the lowest rate.

Example: A green mortgage at 1.5% might be slightly higher than a standard mortgage at 1.4%.

Check the overall deal, as rewards such as cashback or reduced rates may offset small differences in interest rates.

Q7: Is there anything else to know about green mortgages?

Ifthi:

Green mortgages are environmentally friendly and increasingly popular.

The number of providers is growing, and more products may become available in the future, including for remortgages.

If you make energy efficiency improvements, your EPC rating may improve, making you eligible for future green products.

Q8: Can you get your EPC rating updated after improvements?

Ifthi:

Yes, but you need a specialist to reassess your property.

EPCs are valid for 10 years.

There is a fee for the assessment, as a third-party valuer must visit your property.

This may be worthwhile if you want to benefit from a green mortgage.

Q9: Are there government incentives to support green mortgages?

Ifthi:

The government offers various schemes to help improve energy efficiency in homes.

Check the government’s website for grants or incentives that may cover costs like insulation or renewable energy installation.

Disclaimer

These points may not apply to everyone—consult a qualified advisor.

WIS can assist with mortgages, accountancy, wealth management, and insurance.

Mortgages are secured against your home and may be repossessed if repayments are not maintained.

Gemma: Thanks again, Ifthi, for your advice. We’ll be back next week with another episode of Let’s Talk Money and Mortgages. Stay safe and see you soon!