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.
Niche Advice offers appropriate advice on the financing to convert your Buy to Let into an HMO. To find out how we can help you, please complete the online Contact Form on this website or call T:020 7993 2044.
Author: Richard Stokes
Richard Stokes is a partner at Niche Advice who are whole of the market Independent Finance Brokers In London. His role is very much focused on on Mortgage and Insurance products.