Nationwide to Start Offering Green Mortgages
Nationwide Building Society has created a £1bn fund to help borrowers get a mortgage for energy-efficient homes.
The fund will allow Nationwide to offer ‘preferential’ mortgage rates to customers buying a new-build property that has an A-rated Energy Performance Certificate (EPC). The bank has also said it will offer loans with a 1% interest rate, up to £25,000, to homeowners who want to upgrade the energy efficiency of their homes.
Joe Garner, the chief executive of Nationwide, has urged other mortgage lenders to follow its lead and offer green mortgages. He claims it is the best way to encourage people to make their homes more environmentally friendly.
Mr Garner has also called on the government to review and reform council tax in the UK to potentially incentivise homeowners to improve their homes’ energy efficiency. He also suggested that the government’s Help to Buy scheme should be changed to a ‘Help to Green’ programme.
“Nationwide Building Society’s core social purpose is to help people into a place fit to call home,” said Mr Garner. “There is now also an urgent imperative to reduce carbon emissions from those homes.
“On behalf of our members we are calling for government, house builders and lenders to work together to make a significant contribution to achieving a net-zero carbon footprint.
“Our suggested reforms are about creating meaningful incentives for people to green their homes. It’s not about penalising those in society who are least able to pay or putting the burden on local authorities. This is the greatest mutual challenge we face, and we will only make a difference if we work together.”
Dr Rhian-Mari Thomas, chief executive of the Green Finance Institute, said: “Developing the market for financing net-zero carbon and climate-resilient homes is a key objective of the Green Finance Institute’s Coalition for the Energy Efficiency of Buildings.
“We welcome the leadership shown by Nationwide in supporting homeowners and consumers with innovative financial products.
“Nationwide is one of more than 40 members of our Coalition which spans the UK Government, private sector and civil society working collaboratively to launch scalable financial solutions during the course of this year, building on market insights and consumer research that are due to be released over the next few months.”