Solar Panel Installations & Your Mortgage

Before entering an agreement or installing solar, it is essential to review the terms of your mortgage agreement or speak directly with your lender. Solar panels are considered a permanent structural alteration to your property, so it is likely there will be a clause that requires you to notify or seek permission from your lender first. Your lender may ask for assurance that planning permissions have been considered/sought (if required) and that it complies with any relevant building control regulations. In general, lenders are typically supportive due to the improved efficiency of the home and as such improved potential property value.

One specific stipulation from your lender may be that the installation is being carried out by a certified professional, typically under the Micro-generation Certification Scheme (MCS) which helps to reassure them that all relevant safety and building standards are being met. Installers who hold this accreditation will display it on their websites. Details of ours can be found here.

Your lender may also ask whether you intend to purchase your solar system outright (direct purchase) or enter a lease agreement. This is an important detail to clarify with them. Systems purchased outright are considered an 'asset' that will enhance a properties value, whereas a lease agreement can add a layer of complexity. A lease will enter a 3rd-party into the agreement who will subsequently have certain rights over your roof space. If your lender doesn't agree that the terms of the lease agreement are favourable, this could cause issues for the lender, and you, when re-mortgaging or selling your home.

Always keep a complete record of all installation documents, warranties, certificates, and agreements. These will be crucial if your lender needs reassurance in the future or if a potential buyer requests proof of compliance

Does your home insurance policy provide adequate coverage for solar panels? Solar panels will become a fixed, valuable asset to your home. As with the rest of your property you need to ensure they are covered against accidental damage, extreme weather, theft, and potential liability issues.

Contact your insurer in advance to make sure you have the cover you need and to understand if your premiums will be affected. In most cases, your insurer will extend your existing buildings insurance policy to cover your system. However, given the range of systems now available (beyond the standard roof-mounted panels) there may be clauses that are not clear in your terms. So never assume, always contact your insurer to understand if there are any stipulations or restrictions that need considered before installing

For most homeowners in the UK, solar panel installations fall under 'permitted development'. This means that you do not need to submit a planning application. However, you should always check with your local planning authority directly as there may be terms under permitted development that you still need to abide by. This can be  important for flat roofs or where the panels may be deemed to significantly alter the aesthetics of the property.

If your property is listed, located in a conservation area or subject to specific planning restrictions, permitted development does not apply. In these cases you will need to contact your local planning authority and may need to apply for permission before installing solar panels.

Always keep evidence of any planning guidance, contact with your local planning authority or other relevant sources and ensure you use a MCS certified solar installation company. This will be useful if/when you need to re-mortgage or sell your property