Clive Walder, Birmingham Socialist Party
I had a financial plan for my retirement. The modest income from my state and occupational pensions was enough for day-to-day spending and what savings I had would be used for ‘luxuries’ like holidays. Once my savings had run out there was always equity release on my home as I had no outstanding mortgage. Or so I thought.
Before I did anything rash I decided to google ‘grounds for refusing equity release’. As well as the usual things like poor state of repair or inaccessible location, spray foam loft insulation was added.
I had this done in 2020 and it was regarded as the last word in home insulation. Having this done, however, has meant that the surveyor, who decides whether a bank will lend you money against a property, couldn’t inspect the roof timbers for damage.
The product was endorsed by the government, and they even financed its installation for some homeowners. All this changed in March 2024, when the Health and Safety Executive produced a report saying that spray foam insulation could cause 25% of roof timbers to rot within five years if applied to certain materials. This made lenders uneasy and, erring on the side of caution, effectively issued a blanket refusal to mortgage any properties with it. This wasn’t heavily publicised and no consultation took place. The only way you can now get a loan is to have the insulation removed. For me that would cost in the region of £4,000, on top of the £5,500 I had already paid to have it installed in the first place!
Not surprisingly, homeowners regarded government finance as an endorsement. Many homeowners think the government have washed their hands of their responsibility. Private contractors are working in a completely unregulated industry; spray foam insulation is not banned. The government says that it is the homeowner’s decision whether or not to have the work done and mortgaging such properties is the lenders’ decision. The lenders are making sure that it is ordinary homeowners and not themselves that take the financial risk. Lenders put conditions on loans all the time, there is nothing stopping them adding the cost of removal to any loan, and making it a condition of remortgage or equity release.
The Tory and New Labour governments’ mania for giving business a free hand has potentially left 300,000 homeowners with houses they can’t sell or take any equity from. In many cases, this will only become apparent after the owner’s death. If the government really wanted to stand up for working-class people there should be full reimbursement of removal costs, and the big-business building trade, including insulation manufacturers, should pay the costs.
This scandal shows the need for democratic regulation of all industries. The safety of our homes and retirements requires the public ownership of the building and banking industry by workers ourselves.
