Castle Trust Bank has expanded its TermTen buy-to-let range with a new pricing category for HMOs containing between seven and 10 rooms.

The new medium HMO product offers a five-year fixed rate of 5.99% at up to 75% LTV, with loans available from £200,000 to £5 million.

It carries a 3% arrangement fee and a 1% exit fee.

The category sits between Castle Trust Bank’s existing small HMO tier, covering properties with up to six rooms, and its large HMO category for properties containing between 11 and 15 rooms.

The lender said the change was intended to allow brokers to match pricing more closely to the size of the HMO being financed.

Castle Trust Bank’s TermTen proposition combines a 10-year term with a five-year fixed rate and interest-only payments.

The range is available to portfolio landlords, first-time landlords, limited companies and individual borrowers, as well as expats, foreign nationals and borrowers using more complex ownership structures.

In addition to HMOs, TermTen can be used for standard residential properties, multi-unit freehold blocks and holiday lets. Castle Trust Bank uses aggregated values for blocks of flats containing up to 10 units, while holiday lets are assessed using holiday let income.

Loans above £5 million can also be considered on a bespoke pricing basis.

Anna Lewis (pictured), commercial director at Castle Trust Bank, said: “An HMO with seven rooms can present a different lending requirement from one with 15 rooms. Our new medium HMO category recognises that difference, helping brokers match pricing more closely to the property their client is financing.

“Landlords need to consider both their monthly borrowing costs and their longer-term plans. TermTen gives them a way to manage both, while our broad lending criteria help brokers support clients with a wide range of properties and ownership structures.”