HMOs that are valued based on rental income will not be valued by all lenders. Most lenders will consider the HMO to have the same value as a standard home. This can affect the amount of money you can borrow.
A House in Multiple Occupation, also known as HMO, is a property rented to more than one tenant. In this case, the tenants share some of the rooms with each other, such as a bathroom or kitchen. The kitchen, bathroom, lounge and living room. People use the terms "flat share" or "house share" to refer to an HMO.
A House in Multiple Occupation, also known as HMO, is a property being rented to several tenants. Some of these tenants may share the same facilities such a bathroom or kitchen. HMO permits landlords to rent a property to multiple households, instead of renting it to one household.
HMO lenders will consider the impact of higher risk on your ability to repay the mortgage. This is reflected in current interest rates at 3%, compared to 1.7-1.8% for a single-tenancy BTL.
HMOs can be more complicated to manage than traditional buy to rent models. HMOs often have shared facilities, which can lead to tenants falling out. In addition to being a landlord you might also find yourself as a mediator between tenants that don't agree.
But what is often called an HMO by many is actually a large HMO. This refers to a rental property that houses five or more tenants. The tenants share a bathroom, toilet and kitchen. You may also need to have a set number of stories. For a Large HMO to be operated, the license must be held by the landlord. The licence will last five years and can also be called Licsenced HMOs.
HMO Finance Rates The lender's willingness to consider your individual circumstances (e.g., your experience and the location) will affect the rate of interest that you are charged.