There’s a new kid on the block when it comes to mainstream lending and it might well be that you’ve been considering taking out a green mortgage, which have been designed to make it more appealing for people to invest in eco-friendly properties.
The idea is that you’ll be rewarded for taking out a green mortgage on an eco home in the form of better interest rates or cashback – and growing numbers of high street lenders are now starting to offer these products, so it could be well worth investigating if you are keen to live a more sustainable way of life.
There are two types of mortgage you can look into and it will depend on whether you’re keen to invest in another property or if you’d prefer to stay where you are and start retrofitting your existing house with eco-friendly upgrades.
An important distinction does need to be made, however, and this is that the actual mortgage product itself cannot be considered ‘green’. They work in the same way as standard mortgages in that you’ll borrow a sum of money and pay it back in instalments, month by month.
The interest the lender makes on this sum of money is still theirs to invest as they wish – which could mean they’re supporting industries like fossil fuels, which cannot be considered eco-friendly.
In order to be eligible for a mortgage of this kind, it’s likely that your property will have to meet a minimum energy efficiency level – so you’ll need to have an Energy Performance Certificate in place to demonstrate the credentials of the building.
These certificates are required whenever a property is built, sold or rented. They must be ordered for potential buyers and tenants before putting a house on the market to sell or rent.
It contains information about the energy use and typical costs of the property, as well as containing recommendations on how to reduce energy use and save money. They are valid for ten years and give the property a rating from A (most efficient) to G (least efficient).
One lender that may be of particular interest if you’re keen to go green with your mortgage in the future is the Ecology Building Society. They provide both residential and commercial mortgages, as well as community-led and charity finance, so they could well prove to be the right choice for you.
Sustainability is at the heart of their operations, with annual environmental audits carried out, as well as reviews of their environmental policies. Staff members undergo environmental training, all electricity is sourced from renewables and carbon emissions have been offset since the launch of the company back in 1981.
If you’d like any further help relating to green mortgages or if you’re looking for a mortgage application service, get in touch with the team here at Tulip Mortgages today.