New HMO Mortgage Products for Landlords

Foundation Home Loans (FHL) has just launched a new range of products called ‘HMO Plus’ – specifically designed for HMOs that need a commercial valuation, like properties with multiple kitchens.

This means landlords have more options when it comes to buying HMOs, especially those that don’t fit the traditional mould.

What’s New in HMO Plus?

This new range offers landlords two key things:

More Flexibility: These products can be used for HMOs with up to six occupants or bedrooms. This opens up a wider range of potential properties, including those that wouldn’t qualify for standard valuations.
Competitive Rates: FHL is offering two-year and five-year fixed-rate options, with rates starting as low as 6.44% for a five-year fixed-rate mortgage with 65% Loan-to-Value (LTV). All HMO Plus products come with a 2% fee.

Who Benefits Most?

This new product range is ideal for landlords looking to:

Diversify their portfolio: As rental yields are becoming tougher to find, many landlords are looking for alternative ways to boost their income. HMOs can be a great way to achieve this.
Get financing for complex properties: If you’re eyeing a property that needs a commercial valuation, you might have been struggling to find a mortgage in the past. Now, HMO Plus makes it easier than ever to secure financing.

What’s the Catch?

While HMO Plus offers a great opportunity for landlords, there are a few things to be aware of:

Limited Occupancy: These products are only available for HMOs with up to six occupants or bedrooms.
Commercial Valuation Required: Properties with multiple kitchens will need a commercial valuation, which can be more expensive than a standard valuation.

What Does FHL Say?

Tom Jacob, Director of Product and Marketing at Foundation Home Loans, says: “We’re excited to be able to offer landlords a brand new range of products, ‘HMO Plus’, which gives them the flexibility to buy HMOs that might not have been possible before. This new range helps landlords to diversify their portfolios and maximise their rental yield.”