HMO Mortgages

We source competitive whole of market HMO Mortgage rates. HMO mortgages were once extremely easy to obtain with dozens of lenders prepared to advance funds. Now with funding much tighter in the UK investment property sector only a small number of lenders continue to make mortgages available to HMO landlords. Naturally as a successful HMO landlord you don’t want to sell your property portfolio. Let us refinance it for you and allow you to continue growing your business. ProBuytoLet ensures you can refinance your portfolio or purchase new property at the lowest rates or the highest loan size available on the market for HMO mortgages. If it’s possible to obtain your mortgage then your adviser will be able to achieve it as we operate a whole of market panel — no available lenders are overlooked!

Ready to move forward with an HMO Mortgage for your Buy to Let investments? Simply fill out the form and a live representative will contact you shortly to discuss your needs!

Key Features of an HMO Mortgage

  • Lowest rates available
  • All property types considered
  • HMO Finance For Portfolios or single HMO’s
  • Experienced HMO advisers with whole of market access
  • Clear, quick advice – your adviser will tell you within minutes what can be achieved!!ed!

Why ProBuyToLet?

With high street lenders offering a combination of high fees, low loan to value ratios and poor interest rates for Houses in Multiple Occupancy (a call to The Mortgage Works – part of Nationwide – reveals they want 150% rental cover, limit the Loan to 65% on HMO Mortgages and may charge up to 3.5% fee) it’s important that you search for the best HMO Buy to Let Rates. Your HMO broker will discuss all your options and find you the best available package from all the HMO Mortgage Lenders in the UK.

Our panel is whole of market and that includes lenders who only deal with Brokers AND lenders who only deal with select brokers who have commercial and HMO experience. You won’t get more access to deals than we can provide anywhere else!

What is an HMO?

A property will be defined as a house in multiple occupation (HMO) if it is:

  • A shared house that is occupied by more than one household and who share one or more amenities (i.e. w/c, wash hand basin, shower, bath, cooking facilities)
  • A house divided into bed sits, occupied by people who do not form one household and who share one or more amenities
  • An individual flat that is occupied by more than one household and who share one or more amenities
  • A building of self contained flats, that do not meet as a minimum standard the requirements of the 1991 Building Regulation, and at least one third of the flats are privately rented.

Why are HMO Mortgages Required?

It is widely recognised that many HMO residents are among the poorest and most vulnerable in society.
The HMOs that they live in can be particularly difficult to manage and can present a greater risk to occupants than houses occupied by single households. Because of the risks associated with HMOs, licensing for this sector has been introduced.

Who Offers HMO Mortgages?

The Mortgage Works offers them but with as much as a 3.5% fee, just 65% LTV and significantly more rental cover than for regular buy to let. Leeds building society are an HMO Mortgage Lender but only the smallest (up to 5 room) HMO’s making it unsuitable for professional landlords.

Important Considerations

Don’t believe anybody who tells you 70-75% is impossible on HMO’s – our specialist lending panel can advance that much.

Don’t pay a 3.5% fee just because you are investing in an HMO – better deals are available.

Only specialist commercial and buy to let brokers have direct access to some lenders – don’t talk to a residential broker about your specialist needs.

HMO Landlord Responsibilities

The requirements for HMO Landlords are basically the same as any landlord would be tasked with but as HMO Tenants are often from more vulnerable groups of society there are a number of elements set out more clearly than would normally be the case. For example HMO landlords are required to submit to local authority Housing Health and Safety Rating System assessments and carry out any work that is subsequently recommended.

Landlords are also assessed as to their Fit and Proper status to hold an HMO license. This is quite different from regular landlords who are largely unregulated in this regard. Many changes to circumstances at the property will require the immediate notification of the council. Suitable forms are made available by all councils to facilitate these amendments and usually result in an application fee.

The History and Law of HMO’s Leading to HMO Mortgages Being Required

Houses in Multiple Occupancy (HMO’s) arose due to the United Kingdom’s Housing Act of 2004. This was an unusually complex definition of a property but it boils down to the fact that it is occupied by more than one household and more than two people. Fully converted seperate buy to let flats on one title are generally exempt from the regulations and will not need an HMO mortgage.

The effect of this legislation was to effectively make the HMO mortgage market separate from the rest of the buy to let market and leave just a handful of specialist lenders to pick up the applicants. The good news is some really good specialist products are available to HMO mortgage brokers at present which really can beat the high street offerings and the often expensive full commercial offerings some banks may offer through their business banking arms.

Why do Landlords Invest in HMO’s?

The primary reason HMO Property is so popular is because professional landlords can easily manage the multiple tenancy agreements required as well as the licensing issues. Once this is taken care of the rental yields can be as much as double those achieved on some more straightforward property. This does reflect the increased risk and work involve to the landlord but naturally this is something many are prepared to handle for the extra potential rewards. The extra risk makes the benefit of taking good HMO Advice all the greater so why not call free now.