Editor's note: This brief was summarised by The Property AI Newsroom from a report by Mortgage Strategy. Read the original article for full details.

Castle Trust Bank Launches New Medium HMO Mortgage Category

Castle Trust Bank has enhanced its TermTen buy-to-let (BTL) mortgage range by introducing a new price category specifically for medium Houses in Multiple Occupation (HMOs) with between seven and ten rooms. The new offering features a five-year fixed rate of 5.99% at up to 75% loan-to-value (LTV), with loans available from £200,000 to £5 million, subject to a 3% arrangement fee and a 1% exit fee.

This new medium HMO category sits between the bank’s existing categories for small HMOs (up to six rooms) and large HMOs (11 to 15 rooms). The TermTen proposition combines a 10-year term with a five-year fixed rate and interest-only payments.

The product is available to a wide range of borrowers, including portfolio landlords, first-time landlords, limited companies, individuals, expats, foreign nationals, and those with complex ownership structures. In addition to HMOs, the TermTen range also supports standard residential properties, multi-unit freehold blocks, and holiday lets. For blocks of flats with up to 10 units, Castle Trust Bank uses aggregated values, and for holiday lets, the assessment is based on holiday let income. Loans above £5 million may also be considered, subject to bespoke pricing.

This development is relevant for UK letting agents and inventory clerks working with landlords who manage medium-sized HMOs, as it provides a new financing option tailored to this segment of the market.