The short answer: The Warm Homes Loan Scheme is a government-backed loan for heat pumps, solar panels and home batteries. It went live on 27 October 2026 with ten lenders, including HomeServe (with E.ON), Sunsave, Hometree, Tandem and Secure Trust Bank. The government pays lenders to cut the rate, so loans are up to 5 percentage points cheaper than a normal loan and some are interest-free. There is no income test: you need to own the home and pass the lender’s credit checks. It works in England, Scotland, Wales and Northern Ireland. You apply through a lender, an installer or your mortgage provider, not the government, and the work must be done by an MCS-certified installer.
Last verified: 29 October 2026 against the GOV.UK Warm Homes Loan Scheme guide, the DESNZ factsheet (27 October 2026) and the scheme rules (September 2026).
On a lower income? Check the free grants before you borrow. The Warm Homes: Local Grant can fully fund solar, a heat pump and insulation for eligible homes in England, and our eligibility checker takes about a minute. GOV.UK says the same: if you’re on a low income you might get the improvements free instead.
What is the Warm Homes Loan?
The Warm Homes Loan Scheme is the borrowing part of the government’s Warm Homes Plan. It is aimed at people who can afford to repay a loan but don’t want to find the whole cost of a heat pump or solar system upfront.
The money comes from ordinary lenders, such as banks, a credit union and installer finance firms. The government doesn’t lend to you. It pays the lender a grant of up to 20% of the loan, which the lender uses to bring your interest rate down. DESNZ says this means “an up-to-5 per cent reduction in interest rates from regular loans”, and some products are interest-free. Every loan funded this way has to say so: GOV.UK says “the loan product will say if it’s funded by the government through the Warm Homes Loan Scheme.”
What can a Warm Homes Loan pay for?
You can borrow for one improvement or several on the same loan. These are the maximum amounts per measure, from the DESNZ factsheet:
| Improvement | Maximum loan | Can you add a grant? |
|---|---|---|
| Solar panels (PV) | £15,000 | No national solar grant for most homes; 0% VAT on installation until 31 March 2027 |
| Battery storage | £15,000 | 0% VAT until 31 March 2027 |
| Air source (air-to-water) heat pump | £20,000 | Yes: Boiler Upgrade Scheme £7,500 (£9,000 off-gas oil/LPG to 31 March 2027) |
| Ground source heat pump | £35,000 | Yes: Boiler Upgrade Scheme £7,500 (£9,000 off-gas oil/LPG to 31 March 2027) |
| Air-to-air heat pump | £10,000 (once MCS certification is available) | Air-to-air BUS grant rules apply |
| Biomass boiler | £20,000 | BUS biomass rules apply |
| Heat network connection | £7,500 | — |
| Micro-renewables (domestic wind, micro hydro) | £20,000 | — |
Not covered: insulation, windows, doors and gas boilers. For funded insulation see free insulation grants.
Who qualifies for a Warm Homes Loan?
The rules are short. On GOV.UK, to be eligible:
- You must own the property, with or without a mortgage. The scheme rules allow lending to owner-occupiers and private landlords on a personal basis.
- It must be in the UK: England, Scotland, Wales or Northern Ireland.
- It must be residential, not commercial, and an existing home rather than a new build.
- You must use an MCS-certified installer (any installer can connect a heat network). DIY installs don’t count.
- You must pass the lender’s credit and affordability checks.
There is no income limit, no benefits test and no minimum EPC rating set by the government. The scheme rules say DESNZ “will not impose any income-based eligibility thresholds”. Lenders can add their own conditions, such as asking for an EPC.
Renting? Tenants can’t take out a Warm Homes Loan for a home they don’t own. Your landlord can. If you’re on a low income, the Warm Homes: Local Grant for tenants may be a better route.
The 10 Warm Homes Loan lenders
These are the ten lenders on the GOV.UK list on 29 October 2026, with what DESNZ’s launch factsheet says about each. More lenders are expected to join in a second window from late 2026.
| Lender | What DESNZ says about it |
|---|---|
| HomeServe Finance | Lending in partnership with E.ON |
| Hometree Finance | Flexible loans for solar and battery storage, through installer partners, with an optional care plan |
| The Money Co-Op | A not-for-profit co-operative |
| Propensio | Named lender; no product detail published yet |
| Secure Trust Bank | Finance through its V12 Retail Finance platform with retail partners, at a lower rate |
| Selina Finance | Named lender; no product detail published yet |
| South Manchester Credit Union | Named lender (credit union) |
| Sunsave Energy | “Low or zero-interest finance” |
| Tandem Bank | Works with installer partners; almost £1 billion of energy-efficiency lending to date |
| This Bank | Retail finance through multiple partners |
DESNZ notes that “some lenders will partner with specific installers only”, while others let you choose any MCS-certified installer. So the lender you can use may depend on the installer you pick, and the other way round. For rates, terms and eligibility, GOV.UK says to contact the lenders directly.
How to apply for a Warm Homes Loan
GOV.UK lists three ways in. You never apply to the government.
- Through your installer or retailer. This is how most people will get one. When you get a quote for solar, a battery or a heat pump, ask the installer whether they offer a Warm Homes Loan, which lender it’s with, and the APR. Not every installer works with a scheme lender.
- Directly with a lender from the list above.
- Through your mortgage provider, as further borrowing secured on your home. Secured loans can run longer (up to 30 years with some lenders), but your home is at risk if you don’t keep up repayments.
Whichever route you take:
- Get more than one quote and compare the total amount repayable, the term and any monthly fees, not just the monthly payment.
- Check the finance agreement says the loan is funded through the Warm Homes Loan Scheme.
- Check the installer is MCS certified on the MCS website.
- Keep your paperwork: quote, finance agreement, invoice, proof of purchase and MCS certificate. Homes can be picked at random for an audit by DESNZ or MCS afterwards, and that doesn’t mean anything is wrong.
Warm Homes Loan + Boiler Upgrade Scheme: the heat pump stack
This is where the loan pays off most. DESNZ says you can “combine a loan with a grant of up to £9,000 through the government’s Boiler Upgrade Scheme”. The BUS grant comes off the installer’s price first, and the loan can cover what’s left. GOV.UK’s one rule is that the loan and other government funding can’t pay for the same cost twice.
| Illustration only | Gas home (England/Wales) | Oil or LPG home, no mains gas |
|---|---|---|
| Air source heat pump quote | £12,000 | £12,000 |
| Boiler Upgrade Scheme grant | −£7,500 | −£9,000 (to 31 March 2027) |
| Left to pay | £4,500 | £3,000 |
| If borrowed interest-free over 5 years | £75 a month | £50 a month |
The quote is an example price, not a real one. Monthly figures are simple division, assume a 0% product and leave out any fees; your lender’s rate and term will differ. See heat pump costs for real price ranges and the £9,000 off-gas rate for who gets the higher grant.
In Scotland, Home Energy Scotland grants can be used alongside a Warm Homes Loan (GOV.UK). See energy grants in Scotland.
How much could you save on repayments?
DESNZ’s own example: a £10,000 loan at 8% over seven years costs about £155 a month on a regular loan, and through the scheme you could save up to £285 a year on repayments. For comparison, £10,000 at 0% over seven years would be about £119 a month. DESNZ also says a heat pump, battery and solar panels together could save a household up to £550 a year on bills, plus up to £300 more on a time-of-use tariff. Your own savings depend on your home and how you use energy.
Loan or grant? Which route fits you
| Your situation | Start here |
|---|---|
| Household income about £36,000 or less, EPC D–G, England | Warm Homes: Local Grant (free, via your council; many councils are full for 2026/27) |
| On a qualifying means-tested benefit | ECO4 (runs to 31 December 2026) and the Warm Homes: Local Grant |
| Replacing a gas, oil or LPG boiler with a heat pump | Boiler Upgrade Scheme grant + Warm Homes Loan for the rest |
| Want solar and a battery, paying yourself | Warm Homes Loan, or pay cash; solar panel grants explains the free routes |
| In Scotland | Home Energy Scotland grant and loan, plus the Warm Homes Loan |
| Need insulation | Not covered by the loan: see free insulation grants |
Watch out for loan scams. The government won’t cold-call you to offer a Warm Homes Loan, and nobody can charge you a fee to “unlock”, “reserve” or “guarantee” one. Only take finance from a lender on the GOV.UK list, check that the agreement names the Warm Homes Loan Scheme, and never sign on the doorstep. To report suspected fraud, email Warm Homes Counter Fraud at WHLScounterfraud@energysecurity.gov.uk. If you can’t sort out a complaint with a lender, go to the Financial Ombudsman Service. For a complaint about an installer, go to MCS.
Warm Homes Loan: common questions
Is the Warm Homes Loan interest-free?
Some are. The government says ten lenders are “initially offering loans, some interest free”, and that the scheme delivers “an up-to-5 per cent reduction in interest rates” compared with ordinary loans. Sunsave, for example, describes its product as “low or zero-interest finance”. Each lender sets its own rate, so compare the APR and the total amount repayable before you sign.
Can I get a heat pump with the Warm Homes Loan?
Yes. Air source and ground source heat pumps are both covered. The maximum loan is £20,000 for an air-to-water heat pump and £35,000 for a ground source heat pump. You can also claim the Boiler Upgrade Scheme grant (£7,500, or £9,000 for an air or ground source heat pump replacing oil or LPG in a home with no mains gas, until 31 March 2027) to cut the price first. The installer must be MCS certified.
Is there an income limit for the Warm Homes Loan?
No. The scheme rules say the government “will not impose any income-based eligibility thresholds”. Instead the lender runs its usual credit and affordability checks, and it can add its own conditions, such as asking for an EPC.
Who can apply?
You must own the home, with or without a mortgage, and it must be an existing residential property in the UK. The scheme rules cover owner-occupiers and private landlords borrowing personally. Tenants can’t take out the loan themselves, but your landlord can.
Does the Warm Homes Loan cover insulation or windows?
No. The loan covers heat pumps, solar panels, batteries, heat network connections, domestic wind turbines and micro hydro. Insulation, windows and doors are not on the list. For funded insulation, check the Warm Homes: Local Grant or ECO4 (which runs to 31 December 2026).
Is it available in Scotland, Wales and Northern Ireland?
Yes. Unlike the Warm Homes: Local Grant, which is England-only, the Warm Homes Loan Scheme covers any domestic property in the UK. In Scotland it can sit alongside Home Energy Scotland grants.
Do I apply to the government?
No. GOV.UK says: “You apply to a lender that offers Warm Homes loans. You do not apply to the government.” You can apply directly to a lender, through an installer or retailer when you arrange the work, or through your mortgage provider.
How much can I borrow?
The caps are: solar panels £15,000, battery storage £15,000, air-to-water heat pump £20,000, ground source heat pump £35,000, air-to-air heat pump £10,000 (once MCS certification is available for it), heat network connection £7,500 and micro-renewables £20,000. Some lenders offer terms of up to 30 years.
Can I use the Warm Homes Loan with the Warm Homes: Local Grant?
Not for the same improvement. GOV.UK says you cannot use a Warm Homes loan and other government funding to pay for the same improvement. Lower-income households should check the free Warm Homes: Local Grant first, because if you qualify you won’t need to borrow.
Is Great British Energy Guide a lender?
No. We are an independent guide. We don’t lend money, arrange credit or offer finance. If you send us an enquiry, we pass it to one MCS-certified installer that covers your area, and you can ask them which Warm Homes Loan lenders they work with.