What is the mortgage stress test?
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In short: Lenders must check you could still afford repayments if rates rose. The Bank of England removed its mandatory 3% stress test in 2022, but lenders still apply their own.
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Reviewed by Kaiser Khan
When you apply for a mortgage, the lender must satisfy the FCA's 'affordability' rules — broadly, that you could still cover the payments if your circumstances changed.
Until August 2022, the Bank of England required lenders to test affordability against an interest rate 3 percentage points above the lender's standard variable rate. That specific rule was withdrawn, but most lenders still apply a stress rate of their own choosing — typically between 6% and 9%.
Affordability tests use your committed outgoings (other loans, credit cards, childcare costs), not just your salary. Reducing other debts before applying often raises the amount you can borrow significantly.
Primary source: gov.uk/buying-a-home/preparing-to-buy
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