Buy-to-let mortgage calculator
Use this buy-to-let mortgage calculator to see how much rent a property needs to bring in, how much you could borrow, and what your monthly payment, rental yield, cash flow and upfront costs could be. Lenders each set their own rules, so every lender figure here is an input you can change.
Rules last checked 13 October 2026. Tax year 2026/27.
Mortgage type
With an interest-only mortgage you only pay the interest each month, so you still owe the loan at the end of the term.
Use the rate you are quoted. The default is an example, not a market rate.
The Prudential Regulation Authority's standard for buy-to-let lending says lenders should assume a minimum borrower interest rate of 5.5% when stress testing. Each lender decides its own rate.
Rental coverage the lender wants (interest coverage ratio)
The Bank of England says lenders tend to test affordability at a minimum of 125%, using the basic rate of Income Tax, and that in practice they have tended to test borrowers to 145%. Each lender sets its own.
Lenders set their own limit. 75% is an example.
For example agent fees, insurance and repairs.
Include stamp duty for England and Northern Ireland?
Uses the higher rates for buying an additional residential property.
For example legal fees and valuation fees.
Enter the property price and expected monthly rent to see your results.
Nothing you enter leaves your device. This is an illustration, not financial advice or a lender decision. A mortgage adviser or lender can tell you what you can actually borrow. Your property may be repossessed if you do not keep up repayments on a mortgage.
How buy-to-let lenders decide how much you can borrow
Lenders look at how much of the mortgage cost the rent covers. This is the interest coverage ratio (ICR). The Bank of England says ICRs show the proportion of mortgage repayments covered by rental income, and that lenders check that rental income is enough to pay interest costs after maintenance and other letting costs.
Lenders also limit the loan to a share of the property's value. Each lender sets its own rules.
The buy-to-let stress test
The Prudential Regulation Authority's supervisory statement on underwriting standards for buy-to-let mortgage contracts (SS13/16) says lenders should assume a minimum borrower interest rate of 5.5% when stress testing, even if the rate they are charging is lower.
The Bank of England says lenders tend to test affordability at a minimum ICR of 125%, using the basic rate of Income Tax, and in practice have tended to test borrowers to 145%. It gives about 167% as the breakeven ICR for a higher-rate taxpayer. It also says the PRA requirements exclude lending with a fixed-rate period of five years or more, and that banks apply their own affordability standards on top.
These are not rules about your personal mortgage. Your lender will tell you which test applies.
Rental yield and cash flow
Gross rental yield is a year of rent divided by the price. Monthly cash flow here is the rent minus the mortgage payment and your running costs, before tax.
With an interest-only mortgage you only pay the interest each month, so you still owe the loan at the end of the term. With a repayment mortgage you pay off the loan over the term, so the payment is higher.
Buy-to-let stamp duty
In England and Northern Ireland the higher rates of Stamp Duty Land Tax apply when you buy a residential property for £40,000 or more and all of these are true:
- it will not be the only residential property worth £40,000 or more that you own or part own anywhere in the world
- you have not sold or given away your previous main home
- no one else has a lease on it with more than 21 years left to run
| Part of the price | Rate |
|---|---|
| Up to £125,000 | 5% |
| £125,001 to £250,000 | 7% |
| £250,001 to £925,000 | 10% |
| £925,001 to £1,500,000 | 15% |
| Above £1,500,000 | 17% |
| Price | Stamp duty |
|---|---|
| £200,000.00 | £11,500.00 |
| £250,000.00 | £15,000.00 |
| £300,000.00 | £20,000.00 |
| £400,000.00 | £30,000.00 |
| £500,000.00 | £40,000.00 |
| £750,000.00 | £65,000.00 |
| £1,000,000.00 | £93,750.00 |
Non-UK residents pay a 2% surcharge on top, which this calculator does not include. Scotland and Wales have their own taxes.
- Buying in Scotland? Try the Scottish stamp duty calculator.
- Buying in Wales? Try the Welsh stamp duty calculator.
- Buying through a company has its own page: the limited company stamp duty calculator.
Tax on buy-to-let mortgage interest
For individual landlords of residential property, relief for finance costs is restricted to the basic rate of Income Tax. Finance costs are not deducted from rental profits. Instead the landlord gets a tax reduction of 20% of the lowest of: the finance costs not deducted in the year, the property business profits, and total income above the Personal Allowance.
The tax reduction cannot create a tax refund, and unused finance costs are carried forward. This applies to individuals, and a tax adviser can explain your own position. This calculator does not work out tax.
Rent needed for common loans
| Loan | Rent needed at 125% | Rent needed at 145% |
|---|---|---|
| £100,000.00 | £572.92 | £664.58 |
| £150,000.00 | £859.38 | £996.88 |
| £200,000.00 | £1,145.83 | £1,329.17 |
| £250,000.00 | £1,432.29 | £1,661.46 |
| £300,000.00 | £1,718.75 | £1,993.75 |
What this calculator does not include
- Lender fees and product fees.
- Your personal income and credit checks.
- Tax on rental income and the finance cost tax reduction.
- The non-UK resident surcharge.
- Limited company purchases.
- Scottish and Welsh property taxes.
- Houses in Multiple Occupation and holiday lets.
- Selling costs and capital gains tax.
Frequently asked questions
How much can I borrow on a buy-to-let mortgage?
Lenders usually base it on the rent. They check that the rent covers the mortgage interest at a stressed rate by a set margin, and they limit the loan to a share of the property's value. Each lender sets its own limits, so use the figures your lender gives you.
What is the interest coverage ratio for buy-to-let?
The interest coverage ratio (ICR) shows how much of the mortgage cost is covered by the rent. It is the annual rent divided by the annual interest at the stress rate. For example, rent of £12,000 a year against interest of £8,250 a year is an ICR of about 145%.
What ICR do buy-to-let lenders use?
The Bank of England says lenders tend to test affordability at a minimum ICR of 125%, using the basic rate of Income Tax, and in practice have tended to test borrowers to 145%. Each lender sets its own.
What stress rate do lenders use for buy-to-let?
The Prudential Regulation Authority's standard says lenders should assume a minimum borrower interest rate of 5.5% when stress testing, even if the rate is lower. Each lender decides its own rate.
What is the difference between interest-only and repayment?
With an interest-only mortgage you only pay the interest each month, so you still owe the loan at the end of the term. With a repayment mortgage you pay off the loan over the term, so the monthly payment is higher.
Do I pay extra stamp duty on a buy-to-let?
In England and Northern Ireland, yes. Higher rates of Stamp Duty Land Tax apply when you buy an additional residential property for £40,000 or more. From 1 April 2025 they run from 5% on the part up to £125,000 to 17% on the part above £1,500,000. Scotland and Wales have their own taxes.
Can I deduct mortgage interest from my rental income?
Not directly if you are an individual landlord of residential property. Relief for finance costs is restricted to the basic rate of Income Tax. You get a tax reduction of 20% of the lowest of your finance costs, your property profits and your income above the Personal Allowance.
Does this calculator work for buying through a limited company?
No. It covers buying in your own name. Limited company purchases have different tax rules.
Sources
Rules checked against these official pages on 13 October 2026:
- Bank of England: PRA supervisory statement SS13/16
- Bank of England Quarterly Bulletin: The buy-to-let sector and financial stability
- GOV.UK: Stamp Duty Land Tax, buying an additional residential property
- GOV.UK: Changes to tax relief for residential landlords
- GOV.UK: Restricting finance cost relief for individual landlords
Read how we keep calculators accurate, or browse all UK calculators.
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