Spray foam insulation has become popular in the UK because of its excellent energy-saving properties. However, it can cause issues when trying to get a mortgage. Here’s what homeowners and buyers need to know about spray foam insulation and why it might make a property harder to finance.
What Is Spray Foam Insulation?
Spray foam insulation is a material sprayed into roofs, walls, and floors to create a tight barrier that keeps heat in. It expands as it sets, helping to fill gaps and reduce energy bills.
The Good Things About Spray Foam Insulation
- Great at Insulating: Spray foam keeps heat in better than many other types of insulation.
- Reduces Moisture: Closed-cell spray foam can help keep moisture out, lowering the risk of mould and water damage.
- Stops Drafts: It seals cracks and holes, which can help prevent air from leaking in or out of the house.
Why Lenders Might Not Approve Mortgages for Homes with Spray Foam
Despite its benefits, spray foam insulation can cause problems when buying or selling a home. Here are some of the main reasons:
- Hard to Inspect: Spray foam can cover parts of the roof and wood beams, making it difficult for surveyors to check for problems like rot or damage.
- Poor Ventilation: If not applied correctly, spray foam can trap moisture, which can cause wood to decay over time. Good airflow is important for keeping wooden beams in good condition, and some types of spray foam block this.
- Lender Worries: Because of these potential problems, many UK lenders are cautious about homes with spray foam insulation. They may be less willing to approve a mortgage if they think the insulation could hide damage or cause expensive repairs.
- Difficult to Remove: If a homeowner needs to remove spray foam insulation, it can be a tricky and costly process. Removing it might also damage the parts of the house it’s attached to.
What This Means for Mortgages
Mortgage providers have become more aware of the potential issues with spray foam insulation. Many banks and lenders now ask for a detailed inspection report from a professional to confirm that the insulation is not hiding damage or creating risks. If they aren’t convinced, they may refuse to offer a mortgage, making the property “unmortgageable.” This makes it tough for sellers and buyers alike.
Which Lenders won’t Lend?
The BBC recently contacted the largest lenders in the UK, and found:
TSB Bank, Skipton Building Society, Co-operative Bank, Principality and equity release lender Aviva, will not lend on any properties with Spray Foam Insulation.
Yorkshire Building Society and Metro Bank, will usually not lend when there are significant amounts of spray foam present.
Other lenders such as Lloyds, Nationwide, Barclays, the NatWest Group and Santander have said they consider applications on a case-by-case basis, and will take a valuer’s report into account. They may ask homeowners for documentation, showing it has been installed correctly, or for a specialist report to be carried out.
What Homeowners and Buyers Should Do
If you own a property with spray foam insulation or are thinking about buying one, here’s how to handle it:
- Check you have all documentation: This includes a product certificate, installer warranty, before and after photos, a survey report and a product warranty
- Contact the installer/manufacturer: Request a free “health check”
- Get an Inspection: Hire a qualified surveyor to check the condition of the property, especially the roof and beams.
- Talk to Lenders: Let your lender know if a property has spray foam insulation and show them the inspection report. This can help your chances of getting a mortgage.
- Think About Removal: If the spray foam is causing mortgage issues, consider having it removed. This can be expensive, but it may make it easier to sell or refinance the home.
Give Coppenwall a call today for expert advice and guidance on how to make your next move smooth and stress-free: 01706 489 140.
