Leeds Building Society low rate HMO mortgage great for first time HMO landlords.
If you are looking to maximise rental income from your buy to let investment this Leeds Building Society low rate HMO mortgage product is perfect. HMO or to give them their full title ‘houses in multiple occupation’ allow landlords to let bedrooms individually which can increase rental yields substantially. There is added risk to the lenders in terms of obtaining possession and greater potential for security damage from the tenants so normally the rates and fees are much higher than this gem.
Initial Rate: 2.49%Subsequent:5.99%The overall cost for comparison is 4.6%
- Features: Tracker plus 1.99% until 31/10/16. Followed by a variable rate, currently 5.99%, with a discount of 1.00% until 31/10/2019, giving a current rate payable of 4.99%. Variable rate, currently 5.99%
- Minimum deposit / equity: 40%
- Valuation fee: £25
- Other main lender fees: £195 booking fee. £800 arrangement fee.
- Early repayment charges: 3/2% of the amount redeemed until 31/10/16
MY PRODUCT COMMENTS: The rate and arrangement fees on this product are way below the market norm for HMO lending. To give you an idea most alternatives are around the 4.5% to 6% interest rate mark with arrangement fees between £3,000 to £5,000.
MY LENDER COMMENTS: Leeds Building Society are aiming this product at novices and new entrants to the HMO market. It is available to first time landlords but is limited to properties with a maximum of 5 bedrooms. It is suited to landlords looking to invest in student populated areas such as universities and hospitals.
For more information on Low rate HMO mortgage products please complete the enquiry form on this page or call us on 020 7993 2044.
Rates current as at 26/9/14. The overall cost for comparison is based on a property value of £250,000 over a 25 year term. Repayment for Residential and Interest only for Buy-to-let. Eligibility will depend on your own personal circumstances.
The purpose of this web is for information only and is based on a fictitious illustrative scenario. It does not constitute a Mortgage Offer in any way.
It is essential that you seek independent mortgage advice as a suitable product will be based on your own individual circumstances. An interest rate should not be read in isolation, and you should refer to your personal key facts illustration and Mortgage Offers for full terms and conditions. If anything is unclear it should be discussed fully with both your mortgage and legal advisors before entering into a mortgage contract with the lender.
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Your Home is at Risk if you do not keep up with your mortgage repayments.
Author: Payam Azadi
Payam Azadi is a partner at Niche Advice who are whole of the market Independent Finance Brokers In London. His role is very much focused on Property financing both on residential and commercial lines.