Mortgage Affordability & Stress Test
Your lender runs these exact numbers before saying yes. Find out where you stand, and what rate they will actually test you at.
You will need
- Gross annual household income
- Monthly debt payments (car, student loans, etc.)
- Target home price and down payment
- Estimated property tax and heating costs
You will know
- Your GDS and TDS ratios vs lender limits
- Whether you pass the stress test
- Maximum home price you qualify for
- Exactly what rate you will be tested at
Estimated Max Purchase Price
$673,726
With $150,000 down · qualifying at 5.89% · limited by GDS ratio
Max Monthly Payment
$3,316.67
Max Mortgage Amount
$523.7K
How affordability is calculated in Canada
Canadian lenders use two standardized debt ratios — GDS and TDS — both calculated at the stress test rate rather than your actual rate. The stress test rate is the greater of your contract rate + 2% or 5.25%. This ensures you can handle higher payments if rates rise at renewal.
GDS (Gross Debt Service) covers housing costs only: principal and interest, property taxes, heating, and 50% of condo fees if applicable. The maximum is 39% of gross income.
TDS (Total Debt Service) adds all other debt obligations — car loans, student loans, credit card minimums, lines of credit — to your GDS. The maximum is 44% of gross income.
Your maximum purchase price is wherever one of those constraints binds first. Usually TDS is the binding constraint for buyers with significant debt. For buyers with minimal non-mortgage debt, GDS binds. Reducing your debts before applying is often more effective than saving more for a down payment.
What changed in December 2024
Effective December 15, 2024, the federal government made the most significant affordability changes in a decade. Three things changed simultaneously:
Insured limit
Was: $1,000,000
Now: $1,500,000
Buyers up to $1.5M can now use less than 20% down
GDS limit
Was: 32%
Now: 39%
Housing cost ratio increased — more qualifying power
30-year amortization
Was: Not available insured
Now: Available for first-time buyers
Lower monthly payments, more qualifying room
GDS and TDS limits at a glance
| Ratio | What it includes | Maximum |
|---|---|---|
| GDS | Mortgage P&I + property tax + heating + 50% condo fees | 39% |
| TDS | GDS + all other debt payments (car, student, credit) | 44% |
Both ratios are calculated at the stress test rate (contract rate + 2%, minimum 5.25%), not your actual rate.
Frequently asked questions
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