Spray Foam Insulation Mortgage Problems Explained

Spray Foam Insulation Mortgage Problems Explained
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With rising energy bills, spray foam insulation is seen as an effective and efficient way to insulate homes; however, there can be problems when the homeowner wants to sell or remortgage – and buyers need to be wary too.

According to the Property Care Association (PCA) and Residential Property Surveyors Association (RPSA), there are around 250,000 homeowners in the UK that have had spray foam insulation mortgage problems. Basically, they added it to their lofts and have now got unmortgageable properties.

Concern is also growing among mortgage firms and property experts that because the spray foam industry is not regulated, cowboy traders are not correctly installing the spray foam or even using the proper foam – and not checking if the product is correct for the property.

This means that the foam may be causing various problems, and homeowners will have to repair the damage, and they may struggle when they want to sell or remortgage their homes.

Potential buyers need to be aware of what the issues are, and a lot depends on the firm that carried out the work and the type of foam used.

Here, the Property Road team takes a closer look at why using spray foam insulation can be a bad choice for your home.

What is spray foam insulation?

Firstly, we need to understand what spray foam insulation is – and it’s a simple liquid foam that expands to fit an area to create an insulating layer.

Usually, homeowners use it to insulate their roofs. There are two types being used in the UK:

  • Open cell: This foam remains soft after setting and is not as prone to condensation as the alternative. But since it’s not as dense, it doesn’t offer a property with the same level of insulation.
  • Closed cell: This foam becomes rigid when it sets, and there’s a pocket of gas that will slow down heat movement – this offers better insulation than open cell spray foam. The downside to using closed cell foam insulation is that it creates a vapour barrier that doesn’t release air.

It’s worth bearing in mind that the government’s Green Homes grant scheme, which closed in March 2022, offered spray foam insulation as one of the part-funded measures to boost energy efficiency in homes. The government offered to pay up to two-thirds of the insulation cost.

What are the problems with spray foam insulation?

The use of spray foam as an insulation material is not a new one in the UK; it has been used for more than 30 years but not without criticism. That’s because it can:

  • Stop moisture from escaping and cause condensation;
  • Reduce roof space ventilation;
  • Create a greater risk of the roof timbers decaying.

Another big problem with the use of spray foam is that it can be expensive or difficult to remove after it has been installed, and the average cost for this is £40 per square metre. For example, if you have a three-bedroom detached house and want to remove spray foam insulation from the roof, then it could cost you £3,200 to do so.

The other issue for homeowners, and one of the biggest reasons why its use is the focus of recent media interest, is that it can affect the structure of your home.

That’s when the closed cell insulation heats up and cools down, creating gaps in the roof, which can affect the structural integrity of the building. Some media reports have also focussed on poor insulation work that has seen too much foam being used and which is too heavy for the home, and it then also affects the structure.

Also, condensation build-up may lead to structural issues and make it more difficult to sell. For example, the roof timbers may rot.

As a homeowner, you need to understand that remortgaging your property may also be more difficult when having spray foam insulation.

In addition to the PCA and RPSA, the Royal Institution of Chartered Surveyors (RICS) has also raised an issue. It told Which? magazine that it has warned that surveyors may reduce the property’s value if they find spray foam insulation during an inspection.

RICS is also warning that having spray foam may lead to a property being un-mortgageable.

What is the industry doing about spray foam insulation?

In response to some of the issues, the PCA and the RPSA offered guidance that surveyors should recommend that spray foam insulation be removed.

It’s worth noting that the RPSA withdrew that advice in October 2022, pending a review, and said it would make a fresh announcement in early 2023 about what surveyors and homeowners should do.

The RPSA also says it is working with the Insulation Manufacturers Association (IMA) to develop inspection protocols and create a standard installation procedure that all installers can adhere to.

What is the UK government doing about spray foam insulation?

Despite so many homes at risk, the government says there are no plans for it to intervene where mortgage finance or property values have been affected in those properties that used the Green Homes grant scheme to install spray foam insulation.

The government says that the terms and availability of mortgages are an issue for lenders.

It also says that the responsibility of deciding whether to install spray foam insulation is down to the homeowner and its application is the responsibility of the installer.

However, the government has flagged that those consumers who believe a trader may have misled them can use the Consumer Protection from Unfair Trading Regulations 2008 since all traders must adhere to these rules.

One of the issues that has become apparent is that the cowboy traders who have installed spray foam may no longer be in business, so any warranty they offered will not be valid – and they aren’t around for legal action to be taken.

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What can homeowners do about spray foam insulation?

There are several things that affected homeowners can do if they have had spray foam insulation, particularly if a lender says they will not offer funds for a property that has it installed.

There was one equity release specialist that told a newspaper in early 2022, that the mortgage lender would be looking for a valuer’s approval and looking for criteria on the type of spray foam that was used.

The specialist revealed that lenders will use a survey to not only identify the spray foam that was used by the installer but will make a mortgage decision that is based on the survey.

It’s for this reason that any property owner that has had spray foam insulation added to their property should keep all guarantees and paperwork they were given from their installer. This may help a surveyor when they come to assess the work that was carried out.

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Alternative solutions for homes with spray foam insulation include:

  • Consider removing spray foam insulation: You may need to speak to a qualified professional about removing the spray foam insulation from your home. Among those that warn homeowners about removing the insulation themselves is Checkatrade. It highlights that doing this work yourself may damage your property’s electrics, tiles, and other materials. It also warns that some spray foams may be toxic to breathe in and touch. If you want to learn more about how much it will cos to remove spray foam insulation, then Checkatrade provides a helpful estimating tool. Be warned, it’s not going to be cheap.
  • Make a complaint: You could make a complaint to the installation firm or with the accredited oversight body about the foam that has been used or the terms on which it was sold. If you used the Green Homes grant scheme for the work, then you had to use a TrustMark-registered installer, and there’s a dispute resolution process you could access with TrustMark.

Again, if you believe that you have been mis-sold or misled over installation or that the installer has omitted to tell you important information, then you could use the Consumer Protection from Unfair Trading Regulations 2008 to seek redress. This may mean seeking legal or professional advice beforehand to accomplish successfully. You may find this Citizens Advice information useful.

Buying a house with spray foam insulation

Buying a house with spray foam insulation means using a reputable and experienced surveyor and complying with the lender’s criteria. You may even have to source specialist lenders who are willing to forward a loan on a house with spray foam insulation.

The big issue is whether the foam has damaged the roof and the structural integrity because this will leave you with a big bill to resolve. The seller should be honest – however, it may be that the foam installation has been carried out correctly, and you will benefit from lower energy bills.

Spray foam insulation and roof damage

it’s essential to appreciate that spray foam insulation should not cause any damage to your roof when applied correctly. The only problems will come when using closed-cell foam because it’s less porous.

  • Gaps: As explained earlier, the expansion and contraction of the roof caused by the foam will create gaps, so you should consider a roof vent or even having a window to deal with the problem.
  • Bad smells: Some homeowners complain that the foam insulation causes a bad smell to linger for several months afterwards but this is down to the foam being applied too quickly or not expanding properly. An experienced and qualified installer will not make this mistake, so you can wait for the problem to resolve itself or have the spray foam removed completely.
  • Mould and mildew: Mould can also be a problem using closed-cell foam because the insulating seal is much tighter. So, while you will be retaining more warmth, you also create an environment for mildew and mould to blossom. There are various solutions for this, including some homemade remedies but the best way to avoid mould is not to apply spray foam to an area that already has mould or mildew.

Why isn’t the industry regulated?

Despite the spray foam industry not being regulated, there are calls for the government to step in to regulate it from the likes of the RPSA, PCA, and Propertymark, which is the organisation for letting agents.

RICS also supports regulation, and it says that the elderly and other ‘at-risk’ groups have been targeted disproportionately by cowboy traders.

The organisation says there needs to be a collaborative approach to find a resolution to the situation. RICS also gives homeowners this advice:

  • If you want to modify your property, then carry out due diligence to ensure that the work is right for it;
  • Never accept unsolicited or cold call offers to install spray foam insulation;
  • Do not accept cold calls or unsolicited offers to remove an installation.

If you need to install spray foam installation

If you want to install spray foam in your property, always use a certified expert.

As we have highlighted, the installation of spray foam to insulate a property can be an effective way to boost insulation levels and lower heating bills. Here are some tips if you are looking for a spray foam insulation installer:

  • Use an expert independent building surveyor – not one supplied by the spray foam manufacturer or installer – to carry out a pre-installation assessment. This will determine whether spray foam is the correct solution for your property;
  • Use a Trustmark registered company that is certified to the PAS 2030 standard and is certified by KIWA, BRE, or BBE;
  • Ensure you get a warranty for the work that can be transferred to a future owner of your home.

The industry is looking to implement a code of conduct that would require all installers of spray foam insulation to carry out various procedures, including a pre-insulation survey, undertaking moisture readings, and ensuring that relevant documents showing the work has been properly carried out are provided.

And if you are looking at spray foam insulation to save money on your energy bills, it might be worth considering the installation of either a heat pump or solar panels to reduce energy costs since these might be a better investment.

You can also consider new windows or traditional insulation methods, including cavity wall and loft insulation.

Why is spray foam insulation bad?

There’s no doubt that the question ‘Why is spray foam insulation bad?’ will continue to hit the headlines because so many homeowners are at risk of having a home they cannot get a mortgage on or one they cannot sell.

However, a lot depends on the installation firm responsible for the spray foam and what type of foam they used.

Removing the foam may not be a straightforward solution, and if you are looking to remortgage, then it’s worth understanding more about why the lender may refuse a loan and why you need to comply with their criteria.

For this, you will need an experienced surveyor, and if you have used a reputable firm, then you’ll need the paperwork to show that the installation was carried out correctly. If not, you may be looking at a hefty removal bill before you can sell or remortgage.


  • Steve Lumley

    Steve Lumley has years of experience writing about property. His output has covered everything from property investment, news for landlords and student tenants to articles on how to run a successful portfolio and starting out as a property investor. He has also written several books on the subject.

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  • Paul James

    Paul James, is a marketing expert with a passion for property. As well as being a property investor, Paul has also worked within the marketing departments of some of the UK’s leading estate agents. Paul is the founder of Property Road.

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