What is an HMO Mortgage? HMO mortgages are mortgages that landlords use to rent out their properties to more than three tenants. These mortgages are specialized in buy-to-let and have key differences.
HMO mortgages will be required for rents to more then three tenants. The reason is that your property wonÕt be eligible for a regular Buy to Let mortgage. They are only intended for single-household tenants. If you were to apply for a regular mortgage to an HMO property, it would be a violation of the mortgage terms. Lenders could take legal action.
HMOs can be a great option for tenants as they are often affordable, fully furnished and include bills. This is especially true if you are a student, contractor or an overseas employee who is on a work visa. HMOs appeal to people because they are easy and cost-effective.
The location of traditional rental properties isn't a problem. Our nationwide network of letting agents has rented properties in every possible location. They have been rented in every location, from rural to urban.
A House in Multiple Occupation or HMO is a property which is rented to three or more tenants. The unrelated tenants can share facilities like a bathroom or kitchen. HMO lets landlords rent the property to multiple households rather than just one.
Before you make any investment, speak to the HMO licensing officer at your local authority. Before you invest, make sure to check the local definitions and licensing requirements. These may include minimum kitchen size, living space, kitchen facilities and number of toilets.
Only a few UK specialists are available to lend on large HMOs and understand the potential for high yields given the higher risk of multiple tenants. They have their own definitions and criteria for HMOs and the types of properties they will lend against. This is why a broker is needed to help you put together your application and match you with the right broker. CMB is an experienced broker that can package your application to match the lender's terms. This significantly speeds up the process.