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Adapted HMO outside of an Article 4 Direction area
PR Team | 05.06.2024
You’re contacted by a client who’d like to expand their buy to let portfolio by purchasing an HMO. The property has six bedrooms, each with en-suite facilities, and two kitchens, with the rooms spread over three floors. The property is also located outside of an Article 4 Direction area.
Despite running a successful rental business of 43 properties worth around £10 million for a number of years, they’re struggling to secure a mortgage.
They’re finding that many lenders either have a cap on the number of properties they’ll accept or impose a maximum mortgage value. In addition, due to the unusual layout of the property, some lenders won’t consider adapted properties such as the HMO they’re hoping to buy.
You already know we don’t set a limit on the number or value of properties within a portfolio but you’re unsure about whether we’d accept the property type.
You call your BDM who explains that we can consider adapted properties and can instruct investment valuations on five and six bed HMOs, for properties inside of, and certain properties outside of, Article 4 Direction areas (subject to product criteria).
They take the case to underwriting, pre-application, and based on the case information and subject to a full underwrite, they confirm we can approve the application in principle. A conversation worth having…
