Specialist lender Foundation Home Loans has launched a ‘green reward’ BTL product for properties that have a higher energy performance rating.

This five-year fixed rate deal is available on a remortgage-only basis to rental properties with an Energy Performance Certificate (EPC) rating of ‘C’ or above. All rental properties are currently required to have an EPC rating of ‘E’ or above.

For those that qualify, Foundation is offering a 3.75 per cent rate up to 75 per cent LTV, with £750 cashback on completion plus a reduced fee of 0.75 per cent.

Foundation said the product would hopefully act as a catalyst to support the reduction of the carbon footprint from UK residential properties.

It says it hopes this move also raises awareness about the various initiatives that are currently available to support this aim, such as the Government’s ‘Green Homes Initiative’ which is available to landlords and offers grants to help them implement energy-efficient upgrades to their properties. 

This Government initiative was recently extended for a further year and is available until the end of March 2022.

The Green Reward remortgage is also available on an ‘early remortgage’ basis so landlords don’t have to wait the usual six months before remortgaging an improved property to the lender.

Foundation Home Loans commercial director George Gee says this is one of only a handful of products on the market that rewards landlords for making properties more environmentally friendly. 

“There has already been a real movement to increase the EPC ratings of rental properties, but we’d like to reward landlords who make further progress. 

“Once landlords have actively improved the energy efficiency of their properties, we will provide them with access to a product that delivers a competitive rate, with a reduced fee and a generous cashback which they may wish to use to help offset the costs of the improvements.”