Ecology BS launches mortgage cashback offer for heat pump installations

Ecology Building Society is launching a cashback offer for lending that supports the installation of heat pumps.

The lender is introducing the new cashback option for mortgage applications on properties that include a heat pump in a drive to encourage and accelerate the switch to low carbon heating technologies.

The cashback option is available on the Society’s new residential mortgages for self and custom-build, renovations, conversions, and shared ownership as well as for further advances.

Ecology borrowers will benefit from £500 cashback when they install an Air Source Heat Pump (ASHP) and £1,000 when a Ground Source Heat Pump (GSHP) is installed. The installer must be MCS Certified and the cashback is payable on receipt of the certificate of installation.

The cashback also works in tandem with Ecology’s C-Change discounts which rewards the borrower with a discount of up to 1.50% based on the final energy rating for new builds and renovation projects on completion. The discount continues for the remaining term of the mortgage on completion of the build or renovation.

Ecology borrowers in England and Wales undertaking a renovation or conversion may also be eligible for the Government’s Boiler Upgrade Scheme which provides £5,000 grants to homeowners towards the cost of an air source heat pump and £6,000 grants for ground source heat pumps. So, for example, an Ecology borrower installing an Air Source Heat Pump could potentially benefit from £5,500 combining the grant and cashback.

In addition, there is a zero rate of VAT for clean heating measures, helping to make heat pumps even more affordable for people looking to replace a gas or other fossil fuel boiler.

Daniel Capstick, Ecology’s mortgage manager, said: “Decarbonising how we heat our homes is key to meeting our net-zero ambitions. Now, more than ever, it’s important that lenders play an active role in incentivising green building and helping to reduce energy bills.

“We’ve been leading the way on sustainable mortgages for over 40 years and the cashback option makes it more affordable to install heat pumps, incentivising our borrowers to build or renovate to higher energy efficiency standards, which is critical in the fight against climate change.

“It also helps raise awareness of the role of heat pumps as we transition towards a sustainable future.”