Buy-to-Let Mortgage Calculator
This buy-to-let mortgage calculator checks whether a rental property's income clears the interest coverage ratio (ICR) test lenders actually use — not just whether you can afford the deposit. Enter the property value, expected rent and your lender's stress-test terms to see your maximum borrowing and gross yield.
The purchase price or current value of the rental property.
Buy-to-let lenders typically require at least 25%.
What you expect to charge, based on comparable local lettings.
Buy-to-let mortgages are usually interest-only.
Lenders test affordability at a higher notional rate than your actual pay rate — often the pay rate plus 2%, or a fixed floor like 5.5%.
How much your rent must exceed the stressed mortgage payment — 125% for basic-rate taxpayers, 145% is common for higher-rate taxpayers.
Max loan this rent supports
£137,931
The largest loan a lender would let this rental income service, at your stress-test rate and ICR requirement.
How to use this buy-to-let mortgage calculator
- 1Property value and deposit: the basics of the purchase.
- 2Expected monthly rent: use realistic comparable lettings, not a hopeful figure — lenders will ask for a letting agent valuation.
- 3Stress-test rate and required ICR: check your lender's specific figures — these vary, but 145% at a rate around 5.5-7.5% (or pay rate + 2%) is common for higher-rate taxpayers, 125% for basic-rate.
Understanding your results
Max loan this rent supports is often the real ceiling on a buy-to-let purchase — not your deposit, but whether the rental income clears the lender's stressed affordability test. Interest coverage ratio (stressed) is the number that actually gets checked: if it's below your lender's requirement, you'll need a bigger deposit (smaller loan) or higher rent to qualify, regardless of your personal income.
The formula
ICR = (Monthly rent ÷ Monthly mortgage payment) × 100Interest coverage ratio compares rental income to the mortgage payment — lenders test this twice: once at your actual pay rate (a sanity check) and once at a higher stress-test rate (the real qualifying hurdle), since rates can rise over a mortgage term. Working the ICR formula backward from the required ratio gives the maximum loan a given rent can support, independent of your personal income.
A worked example
A £250,000 property with a 25% deposit needs a £187,500 loan. At a 5.5% pay rate, the interest-only payment is about £859/month — with £1,250 rent, that's a 145% ICR at pay rate. But at a 7.5% stress-test rate, the payment rises to about £1,172/month, giving a stressed ICR of about 107% — below a 145% requirement. Working backward, this rent only supports a loan of roughly £138,000, meaning a bigger deposit would be needed to make the numbers work at this rent level.
Notes for the UK, US and India
Buy-to-let mortgages are usually interest-only, sized around rental income rather than personal salary the way residential mortgages are. The stress-test requirement exists specifically to protect landlords (and lenders) from being caught out if rates rise during the mortgage term — a property that barely clears ICR today has little room for a rate increase or a rent-free void period.
Frequently asked questions
Why is the stress-tested ICR so much lower than the pay-rate ICR?+
Because it's deliberately testing a higher, hypothetical rate — lenders want to see the rental income would still comfortably cover payments even if rates rose significantly during your mortgage term, not just at today's rate.
Can I use my personal income to make up a rental shortfall?+
Some lenders offer 'top-slicing', using surplus personal income to support a loan that doesn't quite clear the ICR test on rent alone — but not all lenders offer this, and it usually requires a strong personal income well above the mortgage payment.
Why is the required ICR higher for higher-rate taxpayers?+
Since 2017, mortgage interest can no longer be deducted as a business expense for individual landlords — instead you get a 20% tax credit. This costs higher-rate taxpayers more in real terms, so lenders require a bigger income cushion (145% vs 125% ICR) to compensate.
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