BTL ICR / DSCR Calculator
Check whether rental income covers the mortgage payment at the coverage ratio lenders require for the borrower's tax position — or estimate the maximum loan before a rate is quoted.
Your details
Coverage check
✓ Rent meets the 125% requirement, with £50/mo to spare.
Maximum payment this rent supports
How this works
Actual payment (DSCR) is how lenders really check coverage: rent ÷ actual mortgage payment, against a required percentage that depends on the borrower's tax position — 125% for basic-rate taxpayers and limited companies, 145% for individual higher/additional-rate taxpayers (since Section 24 restricts their mortgage interest tax relief, lenders require a bigger buffer).
Estimate from rate is useful earlier on, before a specific product and payment are known — it works backwards from a loan amount and a notional stress rate instead.
Frequently asked questions
- Why does the required ICR depend on tax status?
- Since April 2020, individual landlords can no longer deduct mortgage interest from rental profit before tax (Section 24) — they get a 20% tax credit instead. This hits higher/additional-rate taxpayers harder, so lenders typically require more rental cover from them (145% vs 125%) to compensate.
- For a 2nd charge loan, do I check DSCR against just the new payment?
- No — rent has to service the combined cost of the existing 1st charge plus the new 2nd charge. See the Second & Third Charge Calculator, which includes this combined coverage check.
- What ICR do BTL lenders require?
- Commonly 125%–145% as described above, but this varies by lender — always confirm with their current criteria.