HMO mortgages
We get HMOs. From first-time landlords to experienced investors, we’ve got products to meet your clients’ needs.
Up to 12
beds
Up to 80%
LTV
Loan size
up to £3m
First-time
landlords
Why place your HMO cases with us
- HMOs of every size
From small HMOs of up to 6 beds to large HMOs of up to 12, for individuals and limited companies.
- First-time landlords welcome
A dedicated range for landlords taking their first step into HMOs.
- Direct access to underwriters
Once the case is submitted, you’ll deal directly with your dedicated underwriter, for decisions you can count on.
Frequently asked questions
- What counts as an HMO?
A property let to at least three tenants who form more than one household and share a kitchen, bathroom or toilet.
- How many beds can the HMO have?
Up to 12. Small HMOs have up to 6 beds, and large HMOs have 7 to 12.
- What’s the maximum LTV and loan size?
Up to 80% LTV, and loans up to £3m. The maximum LTV and loan size depend on the size of the HMO and the product, so check our live HMO products for current limits.
- Can first-time landlords apply?
Yes. We have a dedicated range for first-time landlords on small HMOs of up to 6 beds, at up to 75% LTV and with loans up to £1m.
- What landlord experience do you need?
For our standard HMO range, at least 12 months’ experience as a landlord. If your client has less, our first-time landlord range is built for them.
- Can limited companies apply?
Yes. We lend to SPV limited companies on HMOs, and we have a dedicated range for trading limited companies too.
- What’s the minimum property value?
£120,000, or £75,000 in these qualifying postcodes: BB, BD, CA, CW, DH, DL, FY, HD, HX, L, LA, M, NE, OL, PR, SK, TS, WA, WF, WN and YO.
Does the HMO need a licence?
Yes, where the local authority requires one. We’ll need a copy of the current licence, and on a purchase, a copy of the new licence after completion.- How do you value an HMO?
All our valuations are carried out by RICS registered valuers to Red Book standards. Where appropriate, we may use an investment valuation, which takes the property’s rental income into account.
- How do you assess affordability?
An ICR of 125% for basic rate taxpayers and limited companies, and 140% for higher rate taxpayers, at the stress rates in our pay rate table. Our first-time landlord range uses 135% for basic rate taxpayers and limited companies.
- Does the HMO need a licence?
Yes, where the local authority requires one. We’ll need a copy of the current licence, and on a purchase, a copy of the new licence after completion.
- Do you need planning evidence?
If the property has been altered, converted or changed use, we’ll need evidence of planning permission for its current layout and use before we release funds.
- Can I remortgage an HMO?
Yes. Existing HMOs can be remortgaged onto our standard HMO products, and our existing borrowers can switch with a product transfer. Both allow capital raising, subject to LTV and valuation.
- Can I use an AVM on an HMO?
No. HMOs need a physical valuation.
- Do you lend on HMOs in Scotland?
Yes, on small HMOs of up to 6 beds.