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£1m remortgage on multi unit HMO

£1m remortgage on multi unit HMO

The Client: A full time landlord and property developer looking to grow his property portfolio. The client currently owns two investment properties – one vanilla standard BTL and one high value multi-unit.

The Property: A 4 storey terraced house in North London, converted into two fully converted self-contained maisonettes in 2015. The units are used as two 4-bed HMOs let to professionals. Having large bedrooms and separate gardens for each unit, as well as the demand for property in the area allowed the client to receive a generous rental income.

The Finance: The existing loan of £1,000,000 was coming to the end of its initial rate. The client was keen to find a new competitive 5-year fixed rate and wanted to raise a small amount of capital to put towards his next investment.

The client’s existing lender was no longer taking on new business and as the client only receives rental income as his income source, the case was in need of a specialist lender. The client approached Mortgages for Business for help in finding a new lender that offered competitive rates with a low arrangement fee.

The Application Process: When searching for a suitable product we needed to find a lender who accepted:

  1. Multi units
  2. HMOs
  3. High loan amounts
  4. Rental income as sole source of income

We asked the client to provide us with three months proof of income, proof of ID and proof of address to support his application. We then searched the whole of the market to find a lender. After submitting the application to the lender, an offer was made within a month.

The client was very pleased with his mortgage offer and the swift application process. We are now working with him on the purchase he made with the capital raised from his remortgage.

Here are the details:

Property Details

Property value: £1,600,000

Loan amount: £1,040,000

LTV: 65%

Rate: 3.75% 5 years fixed

Term: 25 years

Mortgage payment: £3,266 pcm interest only

Lender arrangement fee: 0.5%, £5,200 added to loan amount

Rental income: £6,000 pcm

Gross yield: 4.5% pa

Consultant: Andy Elley, 01732 471644


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Mortgages for Business Ltd is registered
in England and Wales No. 2502713.

Registered office:
17 Kings Hill Avenue,
Kings Hill, West Malling,
ME19 4UA.

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Mortgages for Business Ltd is authorised and regulated by the Finance Conduct Authority (No. 313537) to transact regulated mortgages. We are a credit broker, not a lender. We work with the whole of market in sourcing a lender for you; we may receive a commission from the lender, and this amount varies between lenders. The FCA does not regulate some investment mortgage contracts. Mortgages for Business Ltd is a founding member of the National Association of Commercial Finance Brokers, the body that promotes best practice within the commercial finance industry. Telephone calls may be monitored or recorded for training purposes.