Buy-to-Let Mortgage Calculator
Interest-only and repayment costs, plus the lender's stress-test coverage.
Interest-only monthly
£650
Repayment monthly
£894
Total repaid over term
£268,336
Rent needed to pass stress test
£1,178
Stress test
Falls short
Based on 6.5% stress rate at 145% cover.
What this calculator tells you
Buy-to-let lending is assessed on the rent, not on your salary. Lenders apply a stress rate — usually well above the rate you will actually pay — and require the rent to cover it by 125% to 145% depending on your tax band and the product. Knowing the rent figure a lender needs to see is often the difference between an offer and a decline.
How it works
- 1Interest-only monthly cost = loan × rate ÷ 12.
- 2Repayment cost uses the standard amortisation formula over the chosen term.
- 3The stress test recalculates the interest at the lender's stress rate.
- 4Required rent = stressed monthly interest × the interest coverage ratio (125–145%).
Worked example
£150,000 borrowed at 5.2%
- Interest-only: £150,000 × 5.2% ÷ 12 = £650 a month.
- Repayment over 25 years: about £893 a month.
- Stressed at 6.5%: £812.50 a month of notional interest.
- At 145% cover the lender needs rent of £1,178.
A property renting at £1,100 would fail this test — you would need a larger deposit, a five-year fix with a softer stress rate, or a higher rent.
Frequently asked questions
Why do most landlords choose interest-only?
Interest-only keeps monthly costs low and maximises cashflow, and the full interest still attracts the Section 24 tax credit. The trade-off is that the capital is never repaid, so there must be a plan to refinance or sell at the end.
What stress rate do lenders use on five-year fixes?
Five-year fixed products are commonly stressed at the pay rate or a little above, rather than the higher notional rate used for two-year products. That is why longer fixes often allow larger borrowing on the same rent.
Related content
These calculators give general estimates for UK private landlords and letting agents, not legal, tax or financial advice. Figures depend on your circumstances and on the rules in your part of the UK — check the detail or take advice before acting.