Buy-to-let mortgage calculator
Your monthly payment, the rent a lender will want to see, and the most you can borrow, with the arrangement fee included in the rent test the way lenders run it.
Rent test not quite working?
Specialist lenders use different stress rates, top-slicing from personal income and longer fixes to lend more on the same rent. We compare them for you.
Start a buy-to-let enquiryHow buy-to-let mortgages are worked out
A residential mortgage is sized on your salary. A buy-to-let mortgage is sized mainly on the rent. Lenders run an interest cover ratio (ICR) test: the annual rent has to cover the annual interest by a set margin, worked out at a stress rate that is usually higher than the rate you'll actually pay.
Interest cover ratio: 125% or 145%
Limited companies and basic-rate taxpayers are usually tested at 125%. Higher and additional-rate taxpayers are usually tested at 145%, because under Section 24 they can no longer deduct mortgage interest from rental income. That difference alone can cut the maximum loan by around 14%, which is one reason many landlords now buy through a limited company.
Stress rate
On a five-year (or longer) fix, many lenders stress at the pay rate. On shorter fixes, trackers and variable rates, they typically use the higher of 5.5% or the pay rate plus 2%. This calculator uses those typical figures. Individual lenders vary, and some specialist lenders go lower.
Loan to value and deposit
Most buy-to-let lenders lend up to 75% of the property value, and many now go to 80%, so you'll need a 20–25% deposit. Borrowing at 60–65% LTV gets you the lowest rates. HMOs, multi-unit blocks and holiday lets have their own criteria. You can see live products on our sourcing tool.
Arrangement fees and the rent test
Many of the lowest-rate buy-to-let products charge a percentage arrangement fee, often 3–7% of the loan. If you add the fee to the loan, most lenders run the rent test on the total, including the fee, although many let the fee sit on top of the maximum LTV. That can push a deal that only just passes into failing. A higher-rate, lower-fee product sometimes lends more on the same rent, so try both.
Interest only or repayment?
Most landlords take interest-only mortgages to keep monthly payments down and plan to repay the loan when they sell or refinance. A repayment mortgage clears the debt over the term but costs much more each month. Both figures are shown above.
Frequently asked questions
How much can I borrow on a buy-to-let mortgage?
Usually the lower of 75–80% of the property value and the loan the rent supports, including any arrangement fee added to the loan. At a 125% interest cover ratio and a 5.5% stress rate, every £1,000 of monthly rent supports roughly £174,500 of borrowing.
What rent do I need for a buy-to-let mortgage?
Multiply the loan by the stress rate and the interest cover ratio, then divide by 12. For a £200,000 loan at 5.5% and 125%, that is about £1,146 a month.
Is a limited company buy-to-let mortgage better?
For higher-rate taxpayers it often is: the 125% rent test lets you borrow more, and the company can deduct mortgage interest as a cost. Rates are usually slightly higher and you'll give a personal guarantee. See our limited company buy-to-let guide.
Can I top up the rent with my salary?
Some lenders allow 'top-slicing', where surplus personal income makes up a rent shortfall. It's one of the ways a broker can get a case through that fails a standard rent test.
What deposit do I need for a buy-to-let?
Normally 20–25%. Many lenders now go to 80% LTV, and bigger deposits of 35–40% get the best rates.
Does the arrangement fee affect how much I can borrow?
Yes, if it's added to the loan. Lenders usually rent-test the loan including the fee, so a 5% fee on a £200,000 loan means the rent has to cover £210,000. Paying the fee up front, or choosing a lower-fee product, avoids that.