BTL ICR Calculator
Calculate Interest Coverage Ratio for Buy-to-Let mortgage stress testing. Check if your rental income meets lender requirements.
PASSES ICR Test
ICR: 145% vs Required: 145%
145%
Needed: 145%
145%
Current rate
1.45x
Rent ÷ Interest
+0%
Above/below required
Your Headroom
Monthly Interest (Actual)
£1,031
at 5.5%
Monthly Interest (Stress)
£1,031
at 5.5%
| Borrower Type | ICR | Status |
|---|---|---|
Basic Rate Taxpayer | 125% | Pass |
Higher Rate Taxpayer | 145% | Pass |
Limited Company | 125% | Pass |
Portfolio Landlord (4+) | 145% | Pass |
About the BTL ICR Calculator
What it does and how it helps you
The BTL ICR Calculator helps UK landlords calculate Interest Coverage Ratio for buy-to-let mortgage applications. ICR is the key metric lenders use to assess BTL affordability, requiring your rental income to be 125-145% of mortgage interest at stress test rates. Our calculator shows whether you meet lender requirements and how much you can borrow based on rental income.
How It Works
Understanding the calculation method
Interest Coverage Ratio (ICR) is calculated as: (Annual Rent ÷ Annual Interest) × 100 Most UK BTL lenders assess ICR using a stress test rate (typically 5.5%) rather than your actual mortgage rate. This ensures you can still afford payments if rates rise. The required ICR varies by borrower: - Basic rate taxpayers: 125% ICR - Higher/additional rate taxpayers: 145% ICR - Limited companies: 125% ICR - Portfolio landlords (4+ properties): Usually 145% ICR If your rent is £1,500/month and the stressed annual interest is £15,000, your ICR would be (£18,000 ÷ £15,000) × 100 = 120%, which would fail the 125% requirement.
When to use this calculator
Use this calculator before applying for BTL mortgages, when comparing properties to assess which you can finance, or when calculating maximum borrowing. It's essential for understanding if lenders will approve your application based on rental income stress testing.
Frequently Asked Questions
Common questions about this calculator