Lenders are beginning to offer so-called ‘green mortgages’ to reward energy-efficient homeowners with cheap rates.
Virgin Money last week announced its Greener Mortgages for borrowers buying eco-friendly new-build houses, while Nationwide offers cashback to energy-efficient homeowners.
Virgin Money’s Greener Mortgages reward customers who buy greener, new-build homes which have an Energy Performance Certificate (EPC) or Predicted Energy Assessment (PEA) rating of A or B.
Going green? Lenders are beginning to offer so-called ‘green mortgages’
The new mortgage range is available to first and next-time buyers and includes Help To Buy Equity Loan options.
It features a range of two and five-year fixed-rate mortgages, which come with cashback to help towards valuation costs.
A £995 fee applies and the rates — which start at 1.25 per cent — are 0.1 per cent below the equivalent core rates.
The bank also pledged that for every mortgage sold, it will fund sustainable energy projects around the world to offset five tonnes of carbon emissions — the equivalent of those produced by an average UK home over a year.
Meanwhile, borrowers who buy energy-efficient homes can now earn up to £500 cashback with the new Nationwide mortgage.
The building society’s ‘Green Reward’ is available on any property with an energy rating equivalent to an EPC score of A or a high B.
Other providers also offer ‘green mortgages’ for those buying properties with an EPC rating or A or B. NatWest has offered a two-year fix at 1.13 per cent for those with a 40 per cent deposit. Fees are £995 and you get £250 cashback.
