Grants reduce the price. Loans spread what’s left. For heat pumps you can often use both, which can mean nothing to pay upfront.
Last reviewed 3 November 2026 · Independent guide, not affiliated with the UK Government
The difference
| Grant | Warm Homes loan | |
|---|---|---|
| Do you repay it? | No | Yes |
| Income test | Some grants have one | No, but credit checks apply |
| Who applies | Often the installer or council | You, or through your installer |
| Covers | Depends on the scheme | Heat pumps, solar, batteries, heat networks |
Using both for a heat pump
- Your MCS installer applies for the Boiler Upgrade Scheme grant: £7,500, or £9,000 for off-gas oil and LPG homes until 31 March 2027.
- The grant comes off your quote.
- A Warm Homes loan of up to £20,000 (air-to-water) can cover some or all of the rest.
Illustrative example: a £14,000 air source heat pump quote, less a £7,500 grant, leaves £6,500 to pay. A loan could cover that £6,500. Your real quote, rate and term will differ.
If you’re on a lower income
Check the Warm Homes: Local Grant first. It can fund upgrades in full, so you may not need a loan at all.
Latest on loans and grants
- Off oil or LPG? The £9,000 heat pump grant runs until 31 March 2027
- Budget cuts £1bn from Warm Homes Plan grants: what it means for you
- Warm Homes Loan Scheme launches with 10 lenders
Not sure what applies to you?
Answer up to seven questions and we’ll show the grants and loans you may qualify for, with the official contact for each.