A stress test checks that you could still afford your mortgage if interest rates rose. It’s one of the main reasons people are offered less than they hoped, and one of the main reasons UK homeowners coped with the rate rises of 2022–2023 better than in past cycles.
The rules behind it
UK lenders must assess affordability under the FCA’s responsible lending rules (MCOB 11). They have to consider how likely rate rises are over at least the first five years. Until August 2022 the Bank of England also set a specific test: borrowers had to afford a rate 3 percentage points above the lender’s reversion rate. That specific test was withdrawn, but lenders still stress test under the FCA rules. The Bank of England’s loan-to-income limits also remain.
How lenders stress test today
Each lender sets its own approach. Common methods are:
- Deal rate + a margin, often 1–3 percentage points, for short fixes
- The lender’s reversion rate (its SVR) plus a margin
- A floor rate: a minimum rate they test at regardless of the deal
- A lighter test for 5-year or longer fixes, because rate risk in the early years is lower
That’s why longer fixes can let you borrow more: some lenders stress a 5-year fix at or close to the actual rate.
What a stress test does to the numbers
At an average 5-year fixed rate of 4.98%, over 30 years:
| Loan | Payment at 4.98% | Stressed at 6.98% | Stressed at 7.98% |
|---|---|---|---|
| £150,000 | £803 | £996 | £1,099 |
| £200,000 | £1,071 | £1,328 | £1,465 |
| £250,000 | £1,339 | £1,660 | £1,831 |
| £300,000 | £1,607 | £1,992 | £2,197 |
The lender checks that the stressed payment, plus your other commitments and living costs, fits within your income.
How to pass a stress test
- Reduce monthly commitments. Clearing a car loan or credit card often makes the biggest difference.
- Choose a longer fix. Some lenders apply a lighter stress to 5- and 10-year fixes.
- Extend the term. It lowers the stressed payment, but you’ll pay more interest overall.
- Increase your deposit. A smaller loan and lower LTV mean a lower rate.
- Add an applicant whose income counts toward affordability.
Stress testing yourself
A lender’s stress test protects them. Your own should protect you. Before committing, ask:
- Could I afford the payment if my rate went up by 3 points when my fix ends?
- Could I cope if one income stopped for six months?
- What would I cut first?
Try it
The mortgage affordability calculator has an adjustable stress margin under Lender assumptions and shows your payment at the stressed rate. In the mortgage calculator, turn on Fixed rate then reversion to see your payment if your fix ends and you move to a higher rate.
Common questions
Was the mortgage stress test scrapped?
The Bank of England’s specific 3-point test was withdrawn in 2022, but lenders must still check affordability against higher rates under FCA rules.
Why can I borrow more on a 5-year fix?
Many lenders apply a lighter stress test to longer fixes, because your rate can’t rise during the fixed period. See fixed vs tracker.
What stress rate does the calculator use?
Your rate plus 3 percentage points by default. Change it under Lender assumptions in the affordability calculator.
Do remortgages face a stress test?
A remortgage to a new lender usually does. A product transfer with your current lender often doesn’t. See remortgage vs product transfer.
This guide is general information, not financial or tax advice.