Can you borrow more with better EPC Rating?

Yes, a home with an A or B Energy Performance Certificate (EPC) rating may qualify for a higher mortgage loan amount. EPCs help lenders understand how energy-efficient a home is, which can affect the cost of running the home and the cost of making improvements.

More and more high street lenders will be factoring in energy efficiency/EPC ratings when they calculate mortgage affordability in 2025.

Energy Performance Certificates (EPCs) are required for all UK homes marketed for sale or rental and are used to demonstrate the energy efficiency of a property, using an A to G rating system, along with their average running costs. The EPC will also list the applicable recommendations for the property along with the typical savings that upgrading the property could achieve.

Those living in homes with EPC ratings of A or B will typically be spending much less to heat their property, which means they may have more disposable income. In contrast, those living in similar sized homes with an EPC rating of E, F or G are likely face higher energy bills, which could negatively impact monthly outgoings.

Lenders such as Lloyds, Halifax and Bank of Scotland are now factoring this into their affordability assessments, which are used to determine how much can be borrowed when purchasing or remortgaging a property.

The Lloyds Bank website states the following in relation to including EPCs in affordability calculations:

We can better reflect the impact of home energy costs, and some of the financial benefits of more energy-efficient homes. You might then receive a higher loan amount if the EPC is an A or B rating. Or, you might receive a slightly lower loan amount if the rating is F or G.

This is because for houses with a lower EPC rating your energy bills are likely to be higher and so your outgoings will be higher. This will impact the size of the loan you can afford to repay.