Ethical buying guide to Mortgages, from Ethical Consumer.

Ethical buying guide to Mortgages, from Ethical Consumer.

This is a product guide from Ethical Consumer, the UK's leading alternative consumer organisation. Since 1989 we've been researching and recording the social and environmental records of companies, and making the results available to you in a simple format.

Start your mortgage with an ethical bank that is free from fossil fuel investment. 

In this guide:

  • ethical ratings for 40 mortgage providers
  • Best Buy recommendations for most ethical mortgages
  • banks and the arms trade
  • green mortgages
  • switching mortgages


This product guide is part of the special report: Ethical Money

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Our ratings are live updated scores from our primary research database. They are based on primary and secondary research across 23 categories - 17 negative categories and 6 positive ones (Company Ethos and Product Sustainability). Find out more about our ethical ratings


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The score table shows simple numerical ratings out of 20 for each product. The higher the score, the more ethical the company.

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Best Buys

as of July/August 2016

As our ratings are constantly updated, it is possible that these companies will not always come out top on the score table.

The clear Best Buy for mortgages is the Ecology Building Society. It tops the table and only invests in lower-impact buildings and projects. Because of this, their mortgages may not be appropriate for everyone.


Depending on the area where you want to buy the house, a good alternative will be one of the other mutuals. Coventry, Cumberland, Leeds, Newcastle, Principality and West Bromwich Building Societies come out best on our ranking table but only lend in certain areas.

A good, more widely-available option is the Nationwide Building Society.

Always consult an independent mortgage adviser before choosing your  mortgage.

Ethical Business
Directory Links

  • Ecology Building Society    view ethical directory profile >

    Not all financial institutions are the same - we are a building society with a difference. When you place your savi...

Last updated: July 2016



Finding an Ethical Mortgage


Mortgages are usually the biggest financial ‘product’ that most people ‘buy’. As such they can be particularly lucrative for the banking industry – giving them ever more resources to invest in problem sectors around the world such as the fossil fuel industry.

Image: Mortgages in ethical shopping guide


You can read more about the big five banks and their controversial investments in our guide to current accounts.




The greenest mortgage


There is now only one specifically green mortgage available on the market, which is from the Ecology Building Society.

The Ecology Building Society provides mortgages which promote sustainable housing and communities. This might be through energy-efficient housing, ecological renovation of run-down properties, small-scale and ecological enterprises or low-impact lifestyles. 

Image: Ecology in ethical shopping guide


Its innovative C-Change scheme offers home-owners discounts off their mortgage rates for energy-efficient homes.  There are four levels of discount off a standard variable mortgage ranging from 0.50% to 1.25%. The level of discount offered depends on the energy standard of the home, so the more energy efficient the home is, the bigger the saving you can make on your mortgage.

It also has mortgages for energy-saving improvements in existing homes. These might include installing insulation or renewable generation technologies.



Specialists in super-efficient buildings


The Ecology Building Society also specialises in lending for projects that meet the Passivhaus standard. This is a low energy construction standard that exceeds current building regulations. Commonly used throughout Europe, the design of Passivhaus buildings ensure they use around 90% less energy for heating than the average house.

The Passivhaus standard aims to reduce space heating requirements to such a low level that a conventional heating system is no longer needed. Houses built to this standard also often include insulation up to 300mm thick and triple glazing.

Building to the Passivhaus standard can be more expensive, but the move could save you around £900 a year on energy bills as well reducing carbon emissions to zero, and you would qualify for a discount rate from the Ecology Building Society. [1]




Other more ethical options


Others in the mutual sector also provide a better option that the big five, in terms of ethics.

Building Societies are seen as a more ethical option due to the fact they lend mainly in the housing market and don't invest in fossil fuels and other unethical sectors.

All the mutuals featured on the table above (including the EBS) pick up an additional mark in our scoring system for company ethos due to their democratic structures. They also lend to those purchasing all types of homes, and not just environmental alternatives.




Switching mortgages


It is possible to switch mortgage provider in the middle of a mortgage period. Normally this is done for financial reasons, but could be done  for ethical reasons too. It may involve up-front costs such as having a property surveyed again.

You should always seek professional advice before you take on a new mortgage or make a decision to switch. A good place to find an independent mortgage adviser is

Whether switching, or as a first time buyer, ordinary repayment mortgages are always best from an ethical point of view. Interest-only or ‘endowment’ mortgages, of which there has been much mis-selling in previous years and which rely on stock market investments, will always be problematic ethically – as well as less straightforward financially.





Company behind the brand


Santander is also involved in a number of ‘dodgy deals’ including mountain-top-removal coal mining in the United States, the Punta Catalina-Hatillo coal power project in the Dominican Republic and the Rio Madeira dams in Brazil.[2]

According to the ‘Undermining Our Future’ report, Santander gave $14.113 billion in loans and underwriting to selected fossil fuel companies compared to $7.921 billion to selected renewable energy projects during 2009-2014.


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If you want to find out detailed information about a company and more about its ethical rating, then click on a brand name in the Score table. 

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This product guide is part of the special report into ethical money. See what else is in the report.




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Issue 162