Therefore we’ve launched our new and improved Houses in Multiple Occupation (HMO) mortgage range where we’re specialising in both Small HMOs and Large HMOs. Currently, we’re the only lender to do this.
What makes an HMO large or small?
At Leeds Building Society we use the number of occupants to determine whether an HMO is large or small. This way, we can ensure the right type of valuation is undertaken to meet the individual needs for each property type.
Key differences at a glance:
- Small HMOs are classed as properties housing up to and including 6 occupants
- Large HMOs are classed as properties housing more than 6 occupants
There is a maximum of 8 bedrooms for both Small and Large HMO properties.
Occupancy will be independently verified by the Society’s specialist valuer. Where a mandatory licence exists, the licence will be used to determine maximum occupancy whereby you will need to apply the maximum occupancy as detailed on the licence. An occupant is defined as an individual person who resides in the property.
New improved criteria
Recognising the specific needs of HMO landlords, we’ve also improved our qualification criteria:
- 75% LTV for greater purchasing power
- £750,000 maximum loan amount as HMOs tend to be more expensive
- Minimum 165% ICR to account for higher maintenance, running and management costs
- Available on properties with a maximum of 8 lettable bedrooms in order to help landlords access a wider range of HMO properties
Tailor made mortgage products
As part of our new offering, we use specialist valuers and underwriters to provide a service that’s tailor-made for HMO properties:
- Expert HMO underwriters deliver the best client outcomes and a smooth end-to-end process
- Specialist valuers assess the HMO’s property market and rental value based on 100% occupancy of all the lettable rooms
- Bespoke range of competitive HMO products
For more information visit our Small HMO and Large HMO webpage or speak to your dedicated BDM.
This information is for use by FCA authorised intermediaries only and must not be distributed to potential borrowers.
2 Year Small HMO Fixed Rate Mortgage products available are:
- 1.99% available up to 60% LTV (loan to value) with a £999 fee
- 2.09% available up to 70% LTV (loan to value) with a £999 fee
- 2.19% available up to 75% LTV (loan to value) with a £999 fee
2 Year Large HMO Fixed Rate Mortgage products available are:
- 3.54% available up to 60% LTV (loan to value) with a £1999 fee
- 3.59% available up to 70% LTV (loan to value) with a £1999 fee
- 3.84% available up to 75% LTV (loan to value) with a £1999 fee