ABC FinanceHMO MortgagesProcess and criteria

HMO Mortgage Process & Criteria

ABC FinanceHMO MortgagesProcess and criteria

Author: Lee Hemming CeMAP

20+ years experience in HMO Mortgages

Before applying for an HMO mortgage it is important you choose the right lender for your needs. We search the whole market to find you the lowest rates whilst making sure the HMO mortgage process is made as easy as possible.

This guide will give you an understanding of the differences in HMO lender criteria. For more information, you can find out find out more about the interest rates charged on HMO mortgages or use our calculator tool to see what rates are available.

How do I apply for an HMO mortgage?

Follow the steps below to get a feel for the application process or contact us to find out more.

1Discuss your enquiry with either suitable HMO mortgage lenders or a broker who can point you in the right direction and issue you with likely terms showing rate and fees etc.
2When a suitable property is found or if this is a refinance, the process can begin. The lender or broker will run through the application form and send a list of the required documentation needed to begin the application process.
3If the initial decision in principle is agreed by the lender (credit searches carried out etc.), the full application can be submitted and all documents will be checked through by an underwriter.
4If everything is acceptable, the valuation will be instructed and legal work started. The valuation report will provide information to the lender regarding property and rental values, demand for an HMO property in that area and condition of the property.
5If the valuation report is satisfactory, the mortgage offer will be issued. A copy of this will be sent to you and your solicitor. If using a broker, they will usually run through this document with you to ensure it is understood and answer any questions you may have.
6Your solicitor will handle the legal work such as carrying out searches etc. When everything is satisfied and the offer document is signed and returned, the funds can be drawn down.
7Completion of the mortgage can now take place.

HMO mortgage criteria

Here is a range of criteria based on the requirements of numerous HMO mortgage providers:

  • Minimum loans from £25,000 with no maximum.
  • SPV (Special Purpose Vehicle) or Ltd company applications accepted.
  • No maximum number of bedrooms.
  • Terms of 5 – 35 years available.
  • Interest only, capital repayment or part & part.
  • Minimum age 18.
  • Maximum age at redemption 110.
  • Maximum age at application 80.
  • Adverse credit accepted.
  • No minimum income.
  • Portfolio applications accepted.
  • First-time landlords

To browse the best HMO mortgage rates to suit your particular needs please look at our comparison page. Alternatively, check out our HMO mortgage case studies. If you want to speak with an advisor call 01922 620008 and we will answer any questions you may have.

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