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HMO Valuation
Definition
An assessment of an HMO property's value, often required by lenders to determine loan amounts and terms.
Related Terms
Related FAQs
An HMO mortgage is a loan for properties rented to multiple tenants who are not from the same household.
Was this helpful?Most lenders require a minimum deposit of 25% of the property value for HMO mortgages.
Was this helpful?Yes, most HMO properties require a license from your local council, especially if there are 5 or more tenants.
Was this helpful?Minimum room sizes vary by council, but typically single rooms must be at least 6.5m² and double rooms 10.2m². Some councils require larger minimums.
Was this helpful?HMO mortgage rates typically range from 4.5% to 7.5% depending on loan-to-value, property type, and your experience level. Rates are generally higher than standard buy-to-let mortgages.
Was this helpful?Yes, most lenders accept gifted deposits for HMO mortgages, but you'll need a gift letter and proof of the donor's identity and source of funds.
Was this helpful?Apply through your local council's website or office. You'll need property details, floor plans, safety certificates, and to pay a fee. Processing typically takes 8-12 weeks.
Was this helpful?HMO safety requirements include fire safety measures, gas and electrical safety certificates, adequate heating, and proper waste disposal. Specific requirements vary by council.
Was this helpful?You'll need proof of income, bank statements, property details, HMO license (if applicable), rental income projections, and potentially a business plan for larger HMOs.
Was this helpful?HMO mortgage applications typically take 4-8 weeks from application to completion, depending on the lender, property complexity, and whether you have an existing HMO license.
Was this helpful?To get the best HMO mortgage rates, maintain a strong credit score, provide a larger deposit, demonstrate landlord experience, and compare offers from specialist lenders. Using a broker can also help you access exclusive rates.
Was this helpful?HMO mortgage rates are generally 0.5% to 2% higher than standard buy-to-let rates due to the increased complexity and risk associated with multi-let properties.
Was this helpful?Key factors include loan-to-value (LTV), property type, landlord experience, credit history, rental income, and whether the mortgage is for a limited company or individual.
Was this helpful?Yes, most lenders offer both fixed and variable rate HMO mortgages. Fixed rates provide payment certainty, while variable rates may be lower initially but can change over time.
Was this helpful?Rates can change frequently, sometimes monthly, in response to market conditions, Bank of England base rate changes, and lender policies. Always check for the latest rates before applying.
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