Barclays is next week launching a so-called ‘green mortgage’ which links the loan to the Energy Performance Certificate rating of the property being purchased.
It will reward buyers who choose an energy efficient new build home with lower interest rates. It’s the first mortgage to offer preferential rates based on the EPC of a home.
The Barclays Green Home Mortgage will be available to anyone that purchases a home with an A- or B-rated EPC; initially this will be only for purchases of new homes from five builders, but with plans to partner with all major UK house builders by the end of year.
The five in the initial offer are Barratt Homes, Berkeley Group, Countryside Properties, Crest Nicholson, and Redrow Homes and the preferential interest rates will be on two- and five-year fixed rate mortgages up to 90 per cent loan to value, and on Help To Buy mortgages up to 75 per cent LTV.
The average saving on a typical £150,000 mortgage for top-EPC rated mortgages would be £750 over five years.
“We are increasingly hearing from our mortgage customers that they’re interested in purchasing an energy efficient home” says Hannah Bernard, head of Barclays Mortgages.
“We’re proud to be the first major UK mortgage lender to offer a product that helps home buyers in their decision to purchase a green new-build home. On top of this, we are committed to expanding the Barclays Green Home Mortgage suite so that it is available to a wide range of customers and property types by 2019.”