My two sisters and myself have inherited our old family home as our mother recently passed away. The five bedroom house is in need of modernisation. We could sell it but are considering turning it into bedsits. We live in a university town so could let it to students or other people. While browsing the internet I have seen mortgages for HMOs and for student accommodation. Would we need to get specific funding like this for such a project and do we need to specify who would live there?
My first comment would be that you would need to have planning in place to make a change of this nature.
Assuming this is the case, you would need to fund this in two stages.
The first would be short term finance to cover you whilst you do the conversion works, and then a new mortgage which would be available for an HMO once the property was ready to let – so yes, a specific product would be required.
You would not be expected to specify who would live in the property going forward, although some lenders do not permit certain types of tenants, for example those in receipt of housing benefit.
I would therefore suggest that you decide which type of tenants you want to accommodate before you apply for the mortgage so you do not face any problems down the line.
To discuss your options further do call one of our mortgage brokers on 0845 345 6788