Gatehouse Bank unveils green mortgages

Gatehouse Bank has launched Shariah-compliant green home finance products for landlords and homeowners.

The range’s rental rates, the equivalent of interest rates, are 0.10% cheaper than its standard offering.

Products are available to those purchasing or refinancing properties with an A or B energy efficiency rating.

This applies to all residential buy to let, houses in multiple occupation (HMO), and multi-unit freehold blocks products.

All green products come with a 1% product fee at a minimum level of £999.

John Mace, product manager at Gatehouse Bank, said: “The launch of our green home finance proposition is a natural progression for the bank and follows the 2021 launch of our woodland saver accounts, that support UK woodland growth.

“Green home finance products have become increasingly popular as homeowners and landlords alike look to reduce the environmental impact of their properties, and we are delighted to be able to introduce our own offering to this growing market.”

The lender has pledged to offset the carbon footprint of each property for the entire fixed term, and continue for however long a customer remains with the bank, subject to EPC-related conditions at the time.

The bank became operationally carbon neutral in October 2021 as it works to align the business with the UN Sustainable Development Goals, as it is a founding signatory to the United Nations Principles for Responsible Banking.

Comments 1

  1. Had a look on their website as interested in Green and Carbon neutral schemes. Looks like they are a Sharia mortgage provider. While Sharia law prohibits the receipt or payment of interest it has no problem with rent payments. If I understand correctly what this bank are offering is a shared ownership scheme where you gradually buy them out, they avoid the use of the forbidden word interest by calling it “rent”. With rental rates of 3.29% plus, they are not the cheapest as most high St deals are at “rental rates” around 1.75% currently. So borrow £100,000 pay £489/ month ethical rent, but you can save about £5.00 a month if your EPC rating is A or B. Or alternatively you could go along to the High St. and pay £412/month from a non-ethical lender. The choice is yours. Gatehouse also had scheme where you paid only ”rent” for the term and then settled the principal sum at the end. This is no longer available and presumably has gone the way of other endowment mortgage schemes.

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