You are here: Home - Mortgages - Buy To Let - News -

Green mortgages are a mystery to most borrowers

0
Written by: Anna Sagar
01/11/2022
Almost two thirds (63%) of mortgage advisers say their clients have never heard of the term green mortgage, despite more deals coming to the market over the past few years.

According to a survey from the Mortgage Advice Bureau (MAB), which surveyed around 458 mortgage advisers, four out of five (83%) say their clients have no understanding of green mortgages.

The report found that only 3% of advisers said their clients fully understand what a green mortgage is and 14% said customers only partially understood.

What are green mortgages?

Green mortgages are products which typically offer a discounted rate if a property has an Energy Performance Certificate (EPC) between A and C, but some do offer incentives to improve a property’s rating to above C.

The UK government is aiming for the UK economy to be net zero by 2050 and as housing makes up 20 per cent of emissions it is a significant area that needs improvement, MAB said.

Around two thirds of owner-occupied homes have an EPC rating of below C, which also means more needs to be done to improve energy efficiency, according to the report.

How many advisers would propose a green mortgage?

Around 88% of advisers said that green mortgages had come up in conversations in the last 12 months, which shows an increase in awareness.

However, 84% said the topic was prompted by them, and only 3% said the discussion was prompted by clients.

Just 30% of advisers said they would actively propose a green mortgage product, and around 23% said green mortgages were good in theory but not always suitable.

How can advisers help borrowers?

Ben Thompson, deputy CEO at MAB, commented: “While the country’s net zero targets may seem far away, the reality is we are hurtling towards them at a faster rate than many realise. We no longer have the luxury of time, and the industry has a lot to do to not only decarbonise homes but increase consumer understanding of green mortgages and EPC ratings.

“Despite the number of green mortgage products coming to market, there is a considerable disconnect between their benefits and the consumer knowledge surrounding them.

“The industry has an important role to play as educators for consumers, and we’ll continue to work with intermediaries to help push the green agenda forward.”

There are 0 Comment(s)

If you wish to comment without signing in, click your cursor in the top box and tick the 'Sign in as a guest' box at the bottom.

Your right to a refund if travel is affected by train strikes

There have been a wave of train strikes in the past six months, and for anyone travelling today Friday 3 Febru...

Could you save money with a social broadband tariff?

Two-thirds of low-income households are unaware they could be saving on broadband, according to Uswitch.

How to help others and donate to food banks this winter

This winter is expected to be the most challenging yet for the food bank network as soaring costs push more pe...

What will happen if rates change

How your finances will be impacted by a rise in interest rates.

Regular Savings Calculator

Small regular contributions can build up nicely over time.

Online Savings Calculator

Work out how your online savings can build over time.

DIY investors: 10 common mistakes to avoid

For those without the help and experience of an adviser, here are 10 common DIY investor mistakes to avoid.

Mortgage down-valuations: Tips to avoid pulling out of a house sale

Down-valuations are on the rise. So, what does it mean for home buyers, and what can you do?

Five tips for surviving a bear market mauling

The S&P 500 has slipped into bear market territory and for UK investors, the FTSE 250 is also on the edge. Her...

Money Tips of the Week