Paragon Bank has launched a set of buy-to-let mortgages for properties with an energy performance rating of A to C.

Set at 80 per cent LTV, the five-year fixes are set at 3.99 per cent for a single self-contained property and 4.19 per cent for a house in multiple occupation.

The former has an interest coverage ratio of 4 per cent and the latter 4.19 per cent. Both come with £350 cashback.

Paragon managing director of mortgages Richard Rowntree comments: “Landlords have made great strides in adding more energy efficient homes to the private rented sector – or upgrading properties to C or above standard – over the past decade.

Last week, Paragon issued £150m of tier 2 green bonds to fund green loans to landlords.

“However, more needs to be done as the government moves towards its net zero carbon target by 2050 and landlords have a key role to play in that.

“If landlords are to improve the energy efficiency of PRS stock, they need the finance to enable them to do so. Making sure there are attractive options to add new stock, whilst recognising the efforts to upgrade existing properties, is an important element of this.”