For renovations and whole house retrofit, the new product is part of a drive to accelerate the improvement of energy efficiency of existing homes to help meet the UK’s net-zero carbon ambitions, the lender said.
Ecology’s renovation mortgage starts with an initial rate of 3.65 per cent while the renovation works are underway.
On completion of the works borrowers will be eligible for a discount of 0.25 per cent for every energy rating step improvement based on the (EPC) Energy Performance Certificate of the property (up to maximum discount of 1.50 per cent). This retrofit version of Ecology’s pioneering range of C-Change discounts is designed to incentivise and encourage borrowers to upgrade their homes to a better energy efficiency rating.
For example, if a property is improved by four EPC steps from EPC F to EPC B, a discount of 1.00 per cent applies resulting in a variable rate of 2.65 per cent for the remaining term of the mortgage.
An application fee of £600 is payable, while applicants can borrow up to 90 per cent of the property’s value on a repayment basis or 75 per cent on interest-only or part repayment and part interest only.
For homes renovated to the exacting Passivhaus EnerPHit standard, an enhanced discount of 1.25 per cent is applicable on completion of the works with a resulting variable rate of 2.40 per cent for the remaining term of the mortgage.
The society added that it specialises in providing mortgages for renovation projects and in many instances will welcome projects that standard lenders may not accept including where the property is deemed not to be habitable or fallen into disrepair.
Daniel Capstick, Ecology’s mortgage manager, said: “Now more than ever it’s important that lenders play an active role in a sustainable recovery, helping to build back better.
“We’ve been leading the way on green mortgages for nearly 40 years and we hope that our new renovation mortgage will incentivise more people to consider retrofitting their home, which will be critical in the fight against climate change.”
