The Green Deal

[fatcats]

Hi All

Was hoping to get some independent feedback on the Green Deal scheme and if it is actually worthwhile.

We have moved into a doer upper that is freezing cold and needs floorboard insulation, double glazed windows, new rads, probably a new boiler at some stage - these are just the things we know about. I'm sure if we had an assessment that they may find other things as well.

Was wondering if anyone had actually signed up the green deal and what their experience had been so far. I appreciate it's only recently launched.

[the-e-dealer]

what is a 'doer upper' ?

[KidKruger]

ted - reading the OP, I'd venture it's a property that "needs floorboard insulation, double glazed windows, new rads, probably a new boiler at some stage"

[reetpetite]

.

[reetpetite]

In other words " needs doing up " ....

[Lowlander]

Floorboard insulation? Do you mean suspending insulation under bare floorboards on a ground floor?

Double glazing would take at least 15-25 years to pay itself back. Do you feel you need new radiators? Do they even qualify?

A good article here. Probably worth getting an assessment if it's free and you can cherry pick the quick and cheap wins.

http://www.telegraph.co.uk/property/greenproperty/9924717/Eco-living-could-you-take-out-a-Green-Deal-loan.html

[fatcats]

thanks for this link, Lowlander

[the-e-dealer]

Thanks I thought it might be a scruffy upstairs flat . Now about this floor. Insulation. Can you use it on wooden walls?

[Huguenot]

I think there's bit of confusion isn't there? t-e-d?

I may have misunderstood, but it's just a loan isn't it? Yes, it's paid back through a levy on your electricity bill and can only be used on greening your house, but it's just a loan?

The government seem to offer a few hundred quid subsidy at most, but if you're going to do major heating or insulation work it'll be a ?10,000 loan paid off over 25 years at around 7% to 8%.

There's even early repayment fines. Some deal. HMG seem to be loan-sharking?

You'd be better off in many cases simply extending your mortgage wouldn't you?

Happy to hear that I'm wrong?

[Lowlander]

Another link http://www.guardian.co.uk/money/2013/jan/26/green-deal-not-great-deal

You could be right Hugunot

[Burbage]

Lowlander Wrote:

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> You could be right Hugunot

Indeed, he/she/whatever is entirely correct. Though I wouldn't be quite so cynical. Although you will end up with a dodgy loan and some 'consultants' in your life, it can be worthwhile, especially if you're going to rent it out, in which case it'll be the tenants who pay the loan off (as it's them that see the benefit - unless, that is, you go for a cashback deal before renting it out, but only a grasping cynic would think of that dodge).

Originally, I think, the Green Deal was just focused on insulation, rather than other forms of home-improvements, but that seems to have changed, possibly because cavity wall insulation isn't a visible reason for putting the rent up (no matter if tenants would be already paying for it all), so you may be able to get it all done.

You do, however, have to get an 'assessor' round, who will almost certainly not be trying to drum up work for their employer, and therefore won't necessarily focus on adding wildly expensive, and hard-to-repay, elements to your loan, so you might want to do your own sums. Unless tenants will be paying, naturally.

It's still not entirely clear what the loans will be secured against or who will be underwriting them, which may mean everything's been thought through clearly. It looks like the energy companies will be on the hook for defaulters, but that might depend on the exact terms of the contract. As I understand it, the deal-seeker (who may be the owner, landlord or tenant) gets a contract with the Green Deal Provider, who gets paid by the energy company (or one of them, depending if the dual-fuel trap's been avoided) who has a contract with the bill-payer (who may or may not be the owner, landlord or tenant) and nothing can possibly go wrong, apart from the minor inconvenience of a disconnection if a bill doesn't get paid. But I'd check the terms of any agreement very carefully before signing it.

[LauraHW]

As I understand it the green deal was always intended for any measure that leads to an improvement in the energy efficiency of a home, not just insulation.

Agree that with an interest rate of 7 - 8% the Green Deal could prove more expensive than taking out a home owner loan / remortgaging

[uncleglen]

My son got cavity wall insulation with this. He did it through his council (not in London) and he is very shrewd with money.

[fatcats]

Thanks all, for your input. I'm not too convinced by the scheme either, the only thing I thought might make it worthwhile is the Government cashback for various things.

One of the things that puts me off most is that the debt is tied to your home, and that if you sell the new owner takes on the debt. Can imagine that putting a lot of potential buyers off.