Want a free, no obligation quote?

Call Now on 0800 032 4646

HMO Mortgages

Are you interested in investing in an HMO property?

We may be able to help you get the funds needed.

  • Flexible repayment term that works for you
  • Options from £10,000 to £50 million
  • Experienced and first time investors accepted
  • Solutions for HMOs and MUFBs
 
 
 
 

HMO Mortgages

Any property used as security, which may include your home, may be repossessed if you do not keep up repayments on your mortgage.

Feefo Platinum Award

We are a loan broker Authorised and Regulated by the Financial Conduct Authority.
Loans against BTL properties are unregulated, which means they are not subject to the protections of regulation, including; supervision by the Financial conduct authority which helps to protect consumers against bad advice, and being covered by the Financial Services Compensation Scheme (FSCS)

Please accept marketing cookies to watch this video. what is an hmo mortgage?

What is an HMO?

 
 
 
 

Houses of multiple occupancy are rental properties that have at least three unrelated tenants living in it. They will share facilities together, such as kitchens and bathrooms. 

One of the biggest differences between these properties to standard buy to lets is that several households can live there at one time.

One of the most common examples is student properties. This is where you have multiple people from different households all living together.

These properties are becoming more popular, as the returns can be much higher than traditional buy to lets. 

Our experts have a variety of HMO mortgages available that can help you buy or remortgage these properties, allowing you to get your plans underway.

What is an HMO mortgage?

 
 
 
 

HMO mortgages are a type of borrowing solution that helps you purchase or remortgage a house of multiple occupancy.

These solutions are designed to help landlords, as they are often used for renting out to a group of unrelated people.

Our team are experts at HMO purchases and HMO remortgages, so we have the right products and skills to help you.

Solutions range from £10,000 up to £5m, with both repayment and interest only options available.

If you’d like to enquire, either call 0800 032 3535 or use the online form above.

keys house hmo mortgages

Do you need HMO housing experience to qualify for a mortgage?

 
 
 
 

Having experience can be useful when it comes to applying for a mortgage on these properties. This is because it shows that you may be a more reliable borrower. Due to this, it may be easier to get accepted, and you may get lower interest rates.

However, experience is not necessary. It can definitely support your application and make the process easier, but there are still solutions available if you have little or no experience at all in this field.

Even if you’re a first time landlord who doesn’t have any buy to let experience at all, there are still options open to you. Interest rates may, however, be higher to lower the risk to lenders.

Our team has helped many customers (just like you) before, so we have the experience to support you.

Is it a good idea?

 
 
 
 

Investing in an HMO rental can be a profitable opportunity for landlords. Some of the benefits may include:

  • Higher returns – Rental returns can be much higher than traditional buy to lets.
  • Lower void periods – It’s unlikely that all your tenants would move out at the exact same time (unless it’s a student property investment where there may be movement around term times). Therefore, there will be less periods when the property is completely vacant.
  • Income protection–Even if one tenant misses their rent payments you will still get income from the remaining household members. Whereas, with a standard buy to let property if your tenant misses rent payments you will receive no income at all.

Although these are great benefits, it is also important to consider the possible downsides to these investments. Some of these disadvantages may include:

  • More rules – There are more rules around these properties. This means you may need to do more planning to factor in these requirements.
  • Higher upfront costs – As these properties can be larger, there may be more work required to get them up to scratch, particularly if it is being let fully furnished. Therefore, you may have higher upfront costs.
  • Stricter criteria – Qualifying criteria for these products can be stricter, so it may be harder for you to get approved.

What’s the difference between an HMO and a MUFB?

 
 
 
 

HMO housing is a type of shared accommodation that consists of tenants who are not related.

Multi-unit freehold blocks, however, are properties that are split into self-contained living spaces (such as apartments, flats and studios), but they are held under one title.

They differ from HMOs in that the facilities are not shared between tenants. Instead, only the person or household living there uses the facilities.

An example of a MUFB could be a house that has been converted into flats. All of the tenants will have their own space to themselves, and they will not need to leave their accommodation to access certain facilities.

If you’re looking into investing in one of these properties you will need to look at options for a multi-unit freehold block mortgage.

Our experts offer mortgage products for both property types, so we may have a solution available that meets your plans.

How do you apply for an HMO mortgage?

 
 
 
 

Applying for this solution is straightforward. It all starts with a single call or email.

  1. Simply call 0800 032 3535 or email our experts to submit an enquiry. Alternatively, you can fill out our quick online form above and we will contact you.
  2. Our advisors will talk you through the best options we have available for your specific circumstances.
  3. If we find you a product, you decide if it is the right fit for you! If it is, we’ll work with the lender to get your funds sorted.

What our customers say about us

 
 
 
 
customer icon
"The Loan Engine dealt with my bridging loan, and I can honestly say that they were more proactive than me, which is saying something! I can't fault them at all - every time I rang, they knew exactly the latest position of my case, and were always helpful and polite. "
Mrs W, Bordon
22 Jan 2024
customer icon
"Great. Very helpful. Worked hard for us. Worth 5 stars. Use them anytime. "
Mr H, York
17 Jan 2024
customer icon
"They’re friendly and helpful start to finish sandip, emily thank you. From start to finish very helpful I will recommend to everyone thank you."
Mr S, Merthyr Tydfil
05 Jan 2024
customer icon
"Excellent service from start to finish. They went the extra mile when complications arose, big shout out to Thisara. I can’t recommend them enough!"
Mrs M, Leeds
12 Dec 2023
Read more reviews >>

Frequently Asked Questions - HMO Mortgages | Borrow £10k to £50m

 
 
 
 
  • Will I need an HMO licence?

    In short, if it is a large property you will need to apply for a licence. The licence needs to be obtained from the local council where the property is. It’s important to check the criteria and policy details with the council you’re applying to, as these can vary across different locations. 

    For smaller properties, however, you may not be required to get a licence. Some councils still need you to get a licence whether the property is large or small, but others are more relaxed. Therefore, it’s important to check with the council first to see whether you definitely need to apply for one.

  • How much deposit do you need for an HMO?

    The amount of deposit you need can vary depending on which lender you go to. Having a larger deposit can open up more options and help you get a better deal.  Therefore, it is advisable to try and save up as much as you can.

    However, some lenders (mainly specialist providers) are much more flexible with their criteria, meaning they may accept smaller deposits.

  • Where can you get HMO mortgages?

    Mortgage products for these properties can be accessed through a bank, lender or a broker.

    You can go to any provider you wish, however, it may be more appropriate to speak with a broker if you have little or no experience in this area. Brokers have access to a much larger range of products, so your chances of finding a solution may be greater.

    Going directly to a lender or bank can be a good option if you have found a suitable product and know you will be accepted. It also means you won't have to pay the broker fees on top, so it could be more cost-effective.

  • Are HMO mortgages more expensive?

    These products are usually more expensive than standard buy to let mortgages, because there are fewer lenders who operate in the market.

    The lenders who do offer these solutions tend to charge higher interest rates and larger fees, due to the reduced competition.

    Lenders will always make sure you can afford the repayments, but it is important to make sure you are comfortable too. Otherwise, if you struggle to make repayments it could put your property at risk.

  • Can a first time buyer get an HMO rental?

    Yes, you absolutely can get one of these properties even if you’re a first time buyer or a first time landlord.

    The process can be a bit more complicated, as the risk of lending to you is greater when you don’t have any sort of housing track record. Despite this, there are lots of solutions available that you can get.

    We have a wide range of lenders on our panel who specialise in helping customers with more complex circumstances (including first time buyers and those with little or no HMO housing experience). Therefore, we may have the solution you’ve been looking for.  

    It’s worth noting that interest rates may be higher, as the risks for the lender are greater.

Useful guides and blogs

 
 
 
 
Call us Now