Lending criteria for buy-to-let standard and specialist mortgages

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Buy-to-let eligibility criteria

For your case to be considered, please check the applicants and property match our eligibility criteria, and that the loan required is appropriate and affordable.

Our full eligibility criteria can be found at the link below:

Molo Interactive Criteria Guide

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Personal applicants

Our loans are available to applications with up to a maximum of 4 individuals.

Note: This means that you can apply jointly with other individuals.

Applying as a Special Purpose Vehicle (SPV) limited company

Limited companies must be Special Purpose Vehicles registered in England or Wales.

At Molo we currently only lend to companies who carry our accepted SIC codes (at least one of 64305, 64910, 68100, 68209, 68310, 68320, 68201). No other SIC codes will be accepted.

Where an SPV has the following SIC code 68201, this cannot be the sole SIC code.

We only accept companies with up to a total of 4 directors and significant shareholders.

Each director and significant shareholder will need to provide a full personal guarantee.

Note: Take a look at our FAQ page on SIC codes to learn more.

First time landlords

Yes

Portfolio landlords

We lend to individuals or Special Purpose Vehicles (SPVs) with a maximum of 50 mortgaged buy-to-let mortgaged properties (across all applicants).

We have no limit to the number of unencumbered properties in your portfolio.

Note: All portfolio landlords must complete the Molo portfolio form available to download at Portfolio btl.

Customer age

All applicants must be at least 21 at the time of offer.

Adverse credit

Applies to all applicants.

No more than £1000 of satisfied CCJs within last 24 months.

No unsatisfied CCJs.

No previous bankruptcy or IVA in the last 6 years.

No defaults on unsecured products in the past 12 months (all applicants), no more than cumulative £1,000 defaults value in the past 36 months (all applicants), and all defaults must be satisfied on application (all applicants).

No previous repossessions.
Arrears: A maximum of 1 in the previous 12 months (specific to secured arrears, not unsecured debts).

Property valuation

We lend on the basis of the property’s current condition and valuation. In the cases where we aren’t able to accurately assess the value and characteristics of a property through an automated valuation, we will carry out a physical valuation.

Note: Take a look at our Tariff of Charges for the cost of this valuation.

Property value

The minimum property value is £75,000

The maximum property value is £4,000,000

Location

Properties must be located in England or Wales.

Tenure

Freehold, share of freehold or leasehold.

Flying freehold is considered up to 15% of the property.

Common-hold is not acceptable

Leasehold properties must have an unexpired lease of at least 90 years at completion

Note: Take a look at our FAQ page on types of tenure to learn more.

Houses in multiple occupation (HMOs)

We lend to HMO properties with up to 12 lettable rooms.

We lend up to 75% loan to value (LTV).

We will require a physical valuation up to 6 lettable rooms to decide the suitability of the property.

A red-book valuation is required for properties from 7 to 12 lettable rooms.

You must have at least 12 months’ experience as a residential BTL landlord.

HMO license may be required.

Note: An HMO property consists of at least 3 tenants living there, forming more than one household or if facilities like the bathroom and kitchen are shared. It’s also commonly known as a ‘house share’.

In some cases HMOs require licensing from the local authority (it is mandatory for HMOs with 5 or more occupants).

Multi Unit Freehold Block (MUFB)

We lend to MUFB properties with up to 12 units.

We lend up to 75% loan to value (LTV).

Minimum floor area 25 sqm per unit.

We will require a physical valuation for up to 6 units to decide the suitability of the property.

A red-book valuation will be required for properties from 7 to 12 units.

You must have at least 12 months’ experience as a residential BTL landlord.

To be included in the total value, each unit must be separately saleable and serviced for utilities

All units must be owned on the freehold title, and there may be no leases in place at the time of completion.

Ex-local authority properties

A max lend of 75% loan-to-value applies to ex-local authority properties.

New build properties

Properties less than 10 years old must have a NHBC, LABC (Local Authority Building Control), an alternative suitable warranty, or suitably qualified professional consultant’s certificate.

A max lend of 75% loan-to-value applies to new build properties built in the last 24 months (date based on completion certificate).

Tenancies

We will only accept properties that are let on an Assured Shorthold Tenancy (AST) basis of between 6 and 36 months duration.

Student Lets are acceptable.

Holiday Lets (including Airbnb or similar) are acceptable.

Short term lets are not acceptable.

Construction types

We lend on properties of standard construction. Properties of non-standard construction type will be reviewed on a case by case basis and will require a physical valuation.

Note: Properties of standard construction consist of brick and/or block walls under a tiled pitched roof sat on concrete foundations.

Studio flats

Studio flats must be at least 30 square metres (323 square feet) with a separate bathroom.

Flats above commercial premises

We will assess properties above commercial premises on a case by case basis.

Self-build

Self-builds are not acceptable.

Mortgage free properties

We offer loans against an existing ‘mortgage free’ property (also known as unencumbered).

Note: A ‘mortgage free’ property is a property you own outright with no existing mortgage or loans secured against it.

The property must have been mortgage free for a minimum of 6 months and the minimum loan amount is £45,000. If the property was bought outright and you wish to remortgage cash or bridging finance within 6 months of purchase, evidence of the source of funds used may be requested.

Commercial Properties

We cannot accept commercial properties.

Additional Valuation Considerations

Subject to Molo’s discretion, we may consider certain properties as typical investments. These include extensively modified properties with shared or self-contained spaces or those not fitting standard HMO/MUFB definitions. This list isn’t exhaustive; we’d recommend contacting us before applying. If a property meets these criteria, we may request a full Redbook valuation, but approval is evaluated case by case.

Loan purpose

We only provide buy-to-let mortgages and don’t offer residential mortgages at present.

Purchase.

Remortgage.

Remortgage & Borrow More.

Remortgage & Borrow more for debt consolidation purposes.

Note: We allow all three types of loan on non-portfolio landlord buy-to-let mortgages.

Repayment methods

All our mortgages are interest-only.

Note: Rather than having to repay the loan monthly, the full repayment amount is due at the end of the loan period. Therefore, your only monthly payment is the interest only.

Mortgage term

Minimum 5 years, maximum 35 years

Note: If you pay the mortgage in full before the end of the term, you would need to pay an exit fee (take a look at our Tariff of Charges for more information).

Loan size

We have a minimum loan size of £45,000.

Maximum Loan Size – 80% LTV: £1,000,000.

Maximum Loan Size – 75% LTV: £1,250,000.

Maximum Loan Size – 65% LTV: £1,500,000.

Maximum Loan Size – 60% LTV: £3,000,000.

Maximum Loan Size for New Build – 75% LTV

Loan-to-Value (LTV)

Maximum LTV for Remortgage and Borrow More: 75%

We currently offer mortgages up to a maximum of 80% LTV.

Note: This means your deposit will have to be worth at least 20% of the property’s value.

Acceptable sources of deposit

We accept the following as sources of deposit:

Savings.

Equity Release (e.g. sale of another property).

Gift (from immediate family only).

Pension Pot.

Endowments/Shares.

Builders contribution (up to 5% of the deposit).

Offer validity

Molo Mortgage Offers are valid for a period of 4 months.

Legal charge

We will require a 1st Legal Charge on the mortgaged property

Contract changes

Currently we do not allow the following amendments to the mortgage contract:

Additional Lending.

Transfer of Equity.

Portability.

Note: These changes can only be carried out by remortgaging, rather than by amending an already existing contract.

Additional lending: increasing the mortgage loan.
Transfer of equity: adding additional people to the contract as equity holders in the property.
Portability: transferring the mortgage product to a different property.

Consumer buy-to-let

We do not offer loans that are classified as Consumer Buy-To-Let.

Note: We therefore cannot lend to you if both of these statements apply to you:

You don’t have any other buy-to-let properties and,
You or any of your family members have previously lived in the property that you’re intending to let out.

Take a look at our FAQ page on “Consumer buy-to-let” for a more detailed explanation.

Let to buy

We offer loans that are classified as let to buy.

Note: Let-to-buy is when you rent out your existing home and buy a new one to live in. Essentially, it involves having two mortgages at the same time. You convert your existing mortgage to a buy-to-let mortgage so you can let out your current home, and then take out a standard residential mortgage on the home you’re buying.

Loans per customer

We allow you to apply for up to 20 mortgages with Molo, totalling a maximum value of £5 million (combined across both individual and SPVs).

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