If you’re looking into finding a suitable mortgage product for a house that will be an HMO (house on multiple occupancy) and are finding it hard to establish who does what, when and how…….. you’re not alone.
A quick look into the Housing Act 2004, and the definition of exactly what constitutes an HMO property, will give you a clue.
Is it a non licensed HMO, mandatory licensed HMO, or is it subject to the additional HMO licensing requirements? All are questions that may affect a lenders decision whether or not to lend, and of course the “gate keeping” criteria they set; all in addition to the usual property, people and purpose of loan lending considerations.
As such, the availability of mortgages for HMO properties tends to be hidden from view, as most do not appear on mortgage sourcing software. Lenders’ considerations are either far too complex, or variable, to fit all of the criteria questions into a “system”, or loans are bespoke and underwritten on an individual basis with no set in stone criteria.
Lenders generally lend to experienced landlords only, however if the deal feels right overall, and the potential borrower has the right business profile, then some commercial and semi commercial lenders will take the business on the books.
Whether it’s a purchase or a remortgage, if you need an HMO mortgage, speak to one of our team of specialist brokers.