Mortgages suitable for student let HMOs
Student letting accommodation, share house or multi tenancies.
tudent let HMO accommodation is widely accepted by the majority of mortgage lenders. This is the most common use for HMO properties in the UK. Tenancy agreements will be on an Assured Shorthold Tenancy basis and normally all students will sign the same tenancy agreement. This type of tenancy is classed as a ‘joint and several’ tenancy agreement, because if one student leaves, the other remaining students will still be responsible for the whole rent. Contact us to discuss your HMO mortgage for student letting.
Properties will normally have shared kitchen and bathroom facilities, although en-suites are allowed by all lenders. Multiple bathrooms are allowed, but some lenders will not lend for properties with more than 1x kitchen. The most attractive mortgages tend to be for properties with up to 5x letting rooms, but lending is available for properties of any size. Mortgages are available up to 85% of property purchase price (or property value for remortgages) for properties with up to 8x letting rooms. Interest only is available and applicants do not need letting experience with some of these lenders.
For applicants wishing to buy a property for students to rent rooms and share all facilities. The tenancy agreement will normally cover the whole academic year. Available for any size of property and location.
- Student tenants
- HMO or non-HMO student share house accommodation with shared kitchen and bathroom facilities
- Lending in all university city areas
Applicants should be homeowners, unless they are high net worth individuals. Applicants must be employed, self employed, or retired and be able to prove their income. No minimum personal income requirement with some lenders. Mortgages available for existing landlords who have no proof of income. A clean credit history is required, although some minor and historic credit problems can be accepted.
- UK citizen with a passport or UK driving license for ID
- Evidence of deposit funds (bank statement)
- Ideally able to provide proof of earned income, or pension income
- Clean credit history
- Some minor and historic adverse credit can be considered
- Applicants can be employed, self employed or retired
- UK Bank account holder
- Previous letting experience not always required
Types of property
Properties with up to 20 letting rooms are acceptable, with or without an HMO licence. Mortgages are available for properties with up to 5 letting rooms at preferential interest rates. Properties above some commercial premises may be acceptable. Properties must only have 1x kitchen unless specified otherwise.
- Houses of Multiple Occupation (HMO)
- HMOs arranged as flats in one title
- Single AST and multiple AST tenancy agreements accepted
- Property in England, Scotland and Wales
- Properties with or without an HMO Licence
- Accommodation above commercial premises considered
- En-suite facilities in rooms are accepted
- Cooking facilities in rooms accepted
- Shared kitchen and bathroom facilities accepted
- HMOs with up to 20 letting units accepted
- Mixed unit accommodation of flats, studios, bedsits not exceeding 20 units within title
General Lending Criteria
Maximum loans to 85% LTV. Students will usually sign 1x joint tenancy agreement, but some lenders will accept either a single, or jointly signed agreement, or multiple individually signed agreements
BTL-17 – Non-HMO properties only. Existing landlords only. Students only (no maximum number).
BTL-18 – Non-HMO properties only. Maximum of 4 rooms let. Students only.
HMO-1 – Maximum lending is 75% LTV. Experienced landlords only. Multiple kitchens accepted.
HMO-2 – Minimum personal income £25,000 pa (single or joint). Applicants must have at least 3 years current letting experience. Multiple kitchens considered.
HMO-3 & HMO-8 – Maximum lending 75% LTV. Experienced landlords only. Multiple kitchens accepted.
HMO-4 & HMO-6 – England and Wales only. Maximum of 8x rooms let. Only 1 kitchen
HMO-5 – Maximum loan is 65% LTV. Applicants must be experienced landlords.
HMO-7 – This is a repayment mortgage only. Multiple kitchens accepted.
HMO-9 – This lender will allow up to 5x letting rooms. In order for the lender to use the rents from all tenants to calculate the maximum mortgage, the property must have an HMO licence. If the property does not have an HMO licence, or does not require one, then the lender will use a notional rent for a single/family tenancy, but still allow up to 5x tenants to rent the property. Applicants must be an owner/occupier. Minimum personal income of £20,000 pa.
- Purchases or remortgage
- Interest only or capital + interest repayment
- Evidence of deposit funds required
- Evidence of existing UK property
- Share house with joint tenancy agreement accepted
Residential Multi-let Investment
Contact us on 0117 223250 to discuss your requirements with a Buy To Let mortgage specialist
Mortgage Application Assistance
We can even complete the mortgage application on your behalf. The mortgage adviser can help you complete the application over the phone or email.
Products for property investors buying property to refurbish
Additional DetailsExperienced landlords only3 years current letting experienceExperienced landlords onlyMax 8 rooms letExperienced landlords onlyMax 8 rooms letRepayment mortgage onlyExperienced landlords onlyMax 5 letting roomsMax of 4 rooms letNon-HMO properties only
Multiple Kitchens1 Kitchen1 Kitchen
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