This buy-to-let mortgage calculator helps you estimate what your mortgage payment will be based on both interest only buy-to-let mortgages as well as repayment mortgages. See how much you can borrow and what rental income you need.
How much does a buy-to-let mortgage cost?
The total cost of a buy-to-let mortgage depends on a few factors such as the mortgage term or duration, the size of the deposit and the mortgage rate you are able to secure. A good way to secure more favourable rates is to increase the size of your mortgage deposit. You can also determine the cost of your mortgage through interest only mortgage calculator.
How to calculate the rental yield on a buy-to-let property
The rental yield on a buy-to-let property lets you know how much you can expect to make as a percentage of the property value that you are renting out. To calculate the rental yield all you need to know is the annual rental income as well as the property value.
Here is the formula for calculating the rental yield:
Rental Yield = [Annual Rental Income / Property Value]
Rental yield example
If you have a property that has rental income of £1,250 a month and a rental with a property value of £225,000 what is the rental yeild. We can start by calculating the annual rental income which would be £1,250 * 12 = £15,000. Next we need to take the rental yield as a percentage of the property value. £15,000 / £225,000 = 6.67%. Therefore the rental yield on this property is 6.67%.
What is the required deposit for a buy-to-let mortgage?
If you are looking to acquire a buy-to-let mortgage most lenders will want you to have a deposit equal to at least 25% of the value of the buy-to-let property. As you put a larger deposit down the mortgage rates that you are able to get on the buy-to-let mortgage will be more favourable.
Other mortgage calculators
Use our other UK mortgage calculators to help in your decision making process.
Interest Only Mortgage Calculator Mortgage Overpayment Calculator Equity Release Calculator