How We Helped a Landlord Secure A HMO With Just a 20% Deposit!
The latest industry news and guides from Active Mortgages.
The latest industry news and guides from Active Mortgages.
Our client, a small portfolio landlord, was actively looking to expand their portfolio with a new HMO purchase. Their motivation was simple: high rental yields and strong long-term returns. However, they faced a significant hurdle – they only had a 20% deposit, whereas most HMO lenders require a minimum 25% deposit.
Limited deposit – the client only had 20% available, restricting lender options. Specialist HMO lending often comes with tighter criteria and higher deposit requirements. The deal had to work within a limited company structure to maximise tax efficiency.
Despite the deposit challenge, we sourced a lender who was able to support the purchase under a limited company buy-to-let with only a 20% deposit. We recommended a:
✔ 5-year fixed rate at 6.24%
✔ Lender fee: £1,999
✔ Product tailored for HMO purchases within a limited company.
This solution ensured long-term rate stability while allowing the client to leverage their capital more effectively.
✔ HMO purchased with just a 20% deposit.
✔ 5-year fixed product secured under limited company.
✔ Kept client’s growth strategy on track without needing to delay and save a bigger deposit.
✔ Opened the door to stronger cash flow from the HMO’s higher rental yield.
The client was delighted we could make the deal work despite the tighter deposit, especially given how few lenders offer this type of flexibility.
“I thought I’d need to wait and save more – but Jamie made it happen with the capital I had.”
✔ Some specialist lenders will accept 20% deposits – but you need the right broker to find them.
✔ Don’t let traditional deposit rules stop your property plans – there may be options.
✔ Limited company BTLs can provide tax and investment advantages for portfolio landlords.
Book a call with one of our team to talk about your requirements.
