HMO Mortgages

Finance for multi-let properties

Houses in Multiple Occupation generate higher yields than standard buy to let, but they require specialist mortgage products. We work with lenders who understand HMO licensing, room-by-room rental calculations and the specific risks involved.

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FCA Regulated

Licensed & unlicensed

Higher yields

Up to 80% LTV

What counts as an HMO?

A House in Multiple Occupation is a property rented by three or more tenants who form two or more separate households and share facilities such as a kitchen or bathroom. If the property has five or more tenants from two or more households, it requires a mandatory HMO licence from the local authority.

Many local authorities also run additional licensing schemes that capture smaller HMOs. We check the licensing position as part of our process and only approach lenders who are comfortable with the specific setup.

Types of HMO we finance

Small HMOs (3 to 6 rooms)

Shared houses with individual room lets. These are the most common HMO type and the widest range of lenders will consider them. Rates are close to standard buy to let.

Large HMOs (7+ rooms)

Larger properties with seven or more lettable rooms. Fewer lenders operate in this space, but rates can still be competitive. We have access to specialist funds that understand large HMO operations.

Conversions

Purchasing a standard house and converting it to an HMO. We can arrange bridging finance for the purchase and refurbishment, then refinance onto a long-term HMO mortgage once the work is complete and the licence is in place.

Rental calculations

HMO lenders assess rental income room by room. The combined room rents need to cover the mortgage payment by 125% to 145%, depending on the lender and your tax position. Because room rents are higher per square foot than single-let rents, HMOs typically pass affordability tests more comfortably than standard buy to let properties.

Yield advantage

A well-managed HMO can generate gross yields of 8% to 12%, significantly higher than a standard single-let property in the same area. The trade-off is more hands-on management and stricter regulatory requirements. We match you with lenders who price for the yield, not just the risk.

Common questions

Do I need a licence?

If your property is occupied by five or more tenants from two or more households, you need a mandatory HMO licence. Many local authorities also operate additional licensing schemes that capture smaller properties. Check with your council or we can advise.

What deposit do I need?

Most HMO lenders require a 25% deposit, though some will go to 20% for experienced landlords. A few specialist lenders offer up to 80% LTV for strong cases with proven HMO track records.

Can I buy through a company?

Yes. HMO mortgages are available for both personal and limited company purchases. The same SPV structure and SIC code requirements apply as with standard Ltd Co BTL.

What about Article 4 areas?

Some local authorities have introduced Article 4 directions that require planning permission to convert a property to an HMO. Lenders will check this as part of their assessment. We make sure the planning position is clear before submitting an application.

Other investment services

Buy to Let

Standard buy to let mortgages for landlords.

Ltd Company BTL

Tax-efficient portfolio lending through a company.

Holiday Let

Finance for furnished holiday lettings.

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Saturday	By appointment
Sunday	Closed