Will the rent pass the lender's stress test?
Buy-to-let lenders don't size the loan on what you earn — they size it on whether the rent covers the mortgage interest at a stressed rate, by a set margin (the interest cover ratio). Put in the rent and the figures and see pass or fail, plus the most you could borrow. Free, no sign-up.
Which ICR and stress rate should I pick?
ICR: 125% vs 145%. The interest cover ratio is how far the rent must exceed the mortgage interest. Lenders ask 145% from higher-rate (40%/45%) taxpayers because the Section 24 tax change leaves less of the rent in their pocket. Basic-rate (20%) taxpayers and limited companies usually face 125%, as the tax bite is lighter. Pick the one that matches how you will hold the property.
Stress rate. This is a notional "what if rates rise" rate, not your pay rate. Lenders commonly stress a two-year fix at around 5.5% (often pay rate plus about 2%). A five-year fix is usually stressed lower, frequently the pay rate itself with no +2% margin, so a 5-year deal can pass where a 2-year deal fails. If you are taking a 5-year fix, try entering your actual pay rate here.
Top-slicing. If the rent falls a little short, some lenders will "top-slice", counting your surplus personal income to bridge the gap. It is not universal, but it is worth asking a broker about if you are close.
A guide, not mortgage or financial advice. Every lender sets its own ICR and stress rate, applies top-slicing and minimum-income rules, and treats five-year fixes differently — always check the lender's actual criteria with a broker. Nothing you type here leaves your browser.
Rent ÷ stressed interest = the test.
The interest cover ratio (ICR) is how much the rent must exceed the mortgage interest. A lender testing at 145% wants the annual rent to be at least 1.45 times the annual interest. Higher-rate taxpayers usually face 145%; basic-rate borrowers and limited companies often get 125%, because the tax bite on the rent is different.
The stress rate is a notional interest rate the lender tests at — not your actual pay rate. Since the PRA rules came in, lenders typically stress two-year products at around 5.5% (or pay rate plus a margin), and may use a lower stressed rate for five-year fixes. It's there to check the rent still covers the loan if rates rise.
The maths. Stressed annual interest is the loan times the stress rate. The rent the test needs is that figure times the ICR, divided by twelve for a monthly number. Turn it around and the maximum loan is the monthly rent, divided by the ICR, divided by the monthly stress rate.
What it leaves out. This is the core affordability gate, but lenders layer on more: minimum income floors, top-slicing surplus personal income, loan-to-value caps, product fees and portfolio landlord rules. Treat a pass here as "worth a proper conversation with a broker", not a guaranteed offer.
From "can I borrow it" to "does it stack up".
Once the loan passes, the rest is running the property well. Stead's landlord tools track rent and expenses against each property, build a tax-year P&L, and keep gas, EICR, EPC and deposit compliance in one place.