Published 29 October 2018 · Last reviewed 29 October 2018 · Older article — see current rates
Convert your Buy to Let property into an Houses in multiple occupation – HMO
You may have been caught out by the reclassification of your property from a multi-let to HMO? As well as the licence itself the upgrade of the property to meet the HMO requirements might require finance or a mortgage so I thought I would write about refinancing options to convert your Buy to Let into an HMO.
Mortgage Lenders usually stipulate that you divulge the use of the property, e.g. let to a single family, students, DSS tenants, multi-let or HMO. Some limit their lending to a single family. Switching lenders following the new HMO legislation, although required, can, therefore, can be difficult, particularly in the midsts of upgrading when there could be rental voids.
At Niche Advice we recognise the issue and have short-term finance solutions that can pay for the upgrade to HMO status and do not require monthly payments, helpful when the rents aren’t coming in.
How does it work? Well, the interest for borrowing the money is simply added onto the mortgage balance. What’s also clever is once the work has been done and HMO license has been granted there is a seamless transfer onto a tradition mortgage term product with the same lender.
For mortgage information on HMO Mortgages please click here