Milly Turner

Many specialist lenders offer up to 75% LTV on a small, licensed HMO, which means a deposit of around 25% of the valuation or purchase price. Larger HMOs, first-time landlords and pending-licence cases are often asked for more. The deposit is only one test: the rental stress test still has to pass on the room rents.

Milly Turner · Updated October 2026

HMO products are often priced above a standard single-let buy-to-let because of multi-let management, licensing and valuation risk. The gap varies by LTV, room count, experience and whether the loan is in a personal name or a limited company. Use the dated rates page for current ranges rather than a single headline figure.

Milly Turner · Updated October 2026

It is more specialist than a standard buy-to-let, but not automatically unavailable. The case is harder when the licence is missing, the room count is high, the borrower has no landlord experience, or the ICR fails. A licensed small HMO with a 25% deposit and a clear rent schedule is routinely placed with specialist lenders.

Milly Turner · Updated October 2026

Limited-company HMO rates move with the specialist market and are often a little above a comparable personal-name product. There is no single undated headline figure that stays true. Use the dated rates page for current ranges by LTV and borrower type, and treat every number as indicative rather than an offer.

Milly Turner · Updated October 2026

The pay rate is often above a comparable single-let buy-to-let because of multi-let management, licensing and valuation risk. Arrangement fees can also be higher. Whether the loan is more expensive in cash-flow terms depends on the room rents and the valuation method, not the rate alone. Use the dated rates page rather than a single headline figure.

Milly Turner · Updated October 2026

Compare HMO mortgage lenders by criteria first and price second. Start with whether the lender accepts your property type, room count, licence status, borrower experience, ownership structure and rental income. Then compare maximum LTV, arrangement fees, valuation basis, stress rates, early repayment charges and processing times. A low headline rate is not useful if the lender will not accept the property or caps the loan after valuation. For complex HMOs, the best comparison is usually a shortlist of lenders that are genuinely available for the case, not a generic rate table.

Milly Turner · Updated July 2026

Most HMO mortgage lenders require a minimum deposit of 25% of the property's value, meaning you can borrow up to 75% loan-to-value (LTV). However, the exact requirement depends on several factors including your experience, the size of the HMO, and which lender you approach. First-time HMO landlords — those with no previous HMO experience — are typically asked for a 30-35% deposit, as lenders view this as higher risk. Experienced landlords with a proven track record of managing HMOs may find some specialist lenders willing to lend at 75% LTV with only a 25% deposit. For large HMOs (7+ bedrooms) or student lets, lenders often require 30% or more regardless of experience. For example, on a property worth £400,000, a 25% deposit would be £100,000, leaving a mortgage of £300,000; at 30%, the deposit rises to £120,000 with a £280,000 mortgage. The deposit must generally be from your own funds — most lenders will not accept entirely gifted deposits for HMO purchases, though a partial gift may be acceptable alongside your own contribution. One important caveat: the deposit alone does not determine affordability — lenders also apply a rental stress test, typically requiring the projected rental income to cover 125-145% of the mortgage payment at a notional rate of 5-6%. A specialist HMO broker can help match you to lenders whose deposit requirements and stress test calculations suit your specific situation.

Milly Turner · Updated May 2026

As of 2026, specialist HMO mortgage rates often range from roughly 4.5% to 7.5% depending on LTV, experience, and property type. Lower LTV (60–65%) and experienced landlords tend to access sub-5.5% fixes; 75% LTV or adverse credit may be 6–7%+. Rates are usually 0.5–1% above standard buy-to-let because of multi-let risk. Always stress-test at pay rate and at a higher reversion rate — lenders apply ICR or stress tests on room rents, not just headline rates.

Milly Turner · Updated May 2026