Brokers say retrofitting and energy efficiency are topics that borrowers rarely bring up and, when they do, the cost of the improvements is too prohibitive.

A lack of knowledge about energy efficiency and past home improvement scandals, say brokers, deter borrowers from proactively probing a home’s EPC rating and talking through ways to improve the score.

Last week, Mortgage Advice Bureau revealed it had partnered with Effective Home to launch its new initiative, Resilient Homes, that will enable its brokers and business partners to help borrowers improve the efficiency of their homes.

Advisers can introduce their clients to the Effective Home team to have their property evaluated for potential energy efficiency upgrades and should they go ahead, MAB brokers will arrange the finance.

But partnerships like these between broker firms or networks and retrofitting experts are not yet the norm.

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Few referral partnerships

Jon Rawley, partner at broker firm Dart Mortgages Partnership, said that while the topic was slowly becoming “more front of mind” the perceived or real costs to making improvements stopped the few client conversations being had from going forward.

He added: “We don’t have any retrofit referral arrangements in place and I’m not aware of any South West brokers who do but there’s no reason we wouldn’t wish to discuss referral opportunities.

“As always, it’s probably a case of where this sits in the priorities list for brokers and clients, although it’s likely to move up the agenda if education and ‘push’ from local and central government and housing stakeholders ramps up.”

Nicholas Mendes, mortgage technical manager, John Charcol, said the company does not have any partnerships in place but it was under consideration. “There is growing momentum among lenders to support retrofitting and we’re currently looking at options as to how we can support and work with partners.”

Mortgage lender initiatives

Among those supporting retrofitting are lenders such as Skipton Building Society with its free EPC assessment and Coventry BS which offers a home energy efficiency tool. Nationwide offers a 0% green additional borrowing product and Virgin Money rewards customers for making certain energy efficiency improvements.

Meanwhile, Molo and Hodge have signed up to use retrofitting software supplied by Propflo.

Small business owner Jane King, mortgage and equity release adviser, Ash-Ridge Private Finance, says she would consider proactively discussing the need for, and merits of, energy efficiency if she had the expertise or could refer them to someone with the knowledge. But she adds, it’s not a topic her clients ever bring up or one she currently pursues.

“I think the main reason is lack of time. I am a small business and finding time to manage requests over and above what I do already would be difficult timewise,” said King.

Brokers also said that mis-selling scandals such as spray foam insulation have caused them to have no confidence in referring their clients to home improvement companies.

To help brokers build their knowledge, The Green Finance Institute along with mortgage industry trade bodies and networks have developed a handbook that promises to educate and inform intermediaries about green home retrofit solutions and technologies.

Support and incentivise

Luke Loveridge, owner and founder of green technology firm Propflo, works with a number of different sized brokerages such as Habito and smaller firms such as Mortgage Webb.

He said: “We’re in a chicken-and-egg situation. Brokers don’t ask about energy efficiency so customers aren’t aware. It’s understandable from a broker’s perspective as it is currently a distraction, they don’t earn anything more, and they aren’t retrofit experts.”

Loveridge said his company’s vision is to support and incentivise brokers to discuss energy efficiency with their clients and signpost them to resources when a natural time to carry out improvements arises such as when it’s time to remortgage or buy a new home.

Propflo provides brokers with a free tool that they can send their clients to guide them on their retrofitting journey and gives them the opportunity earn up to money for referrals.