Specialist lenders launch new buy to let and semi-commercial mortgage products

Foundation Home Loans launches new HMO and Multi-unit rates while Hampshire Trust launches new semi-commercial products and updates its buy to let offerings.

Specialist lender Foundation Home Loans today launched a new range of buy to let products aimed at investors in large HMOs (Homes of Multiple Occupation) and MUFBs (Multi-unit Freehold Blocks).

To qualify for one of the new loans, an HMO must have more than six bedrooms and a maximum of eight, while an MUFB must contain more than six units, with a maximum of 10.

The new products are also designed for the purchase of purpose built MUBs, regardless of the number of units.

In addition, they will be applicable where there is more than one bedroom in a single unit - for example, a converted block of five units where at least one of the units is a two-bed flat.

The maximum loan is £1 million, where the loan-to-value ratio does not exceed 65%. At up to 75% LTV the maximum loan is £500,00.

A typical buy to let loan on a large HMO carries an interest rate of 3.89%, fixed to the end of July 2023.

Elsewhere this week, Hampshire Trust Bank increased the loan-to-value ratio and reduced the rates on its semi-commercial fixed rate mortgages, as well as on its buy to let and HMO products.

In addition, it has increased the maximum loan size on these products to £5m. Larger transactions are considered on a case by case basis.

As part of the revamp, the bank has increased the LTV ratio to 75% on its BTL and HMO two-year fixed rate and semi-commercial fixed rate mortgages portfolio, introducing reduced rates that start from 3.98%. This follows a recent enhancement to its BTL and HMO five-year fixed rates.

Matthew Wyles, Chief Executive Officer at Hampshire Trust Bank, said:

“The bank is now announcing a significant widening of its proposition and its target market, particularly in terms of our appetite for larger transactions. We have the skills, systems and strength to evolve rapidly into a leading player in specialist lending.”


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