Affordability and stress test
Canadian lenders qualify you at the higher of your contract rate plus two percentage points or 5.25%, not at the rate you will pay. At that qualifying rate, your housing costs (mortgage, property tax, heat and half of any condo fee) generally have to stay under 39% of gross income, and all your debts under 44%. Enter your income, debts and down payment to see the price those limits allow.
Affordability
What could you qualify for?
- Maximum purchase price
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- Payment at your contract rate
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- Qualifying rate
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- Mortgage amount
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- Housing ratio (GDS)
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- Total debt ratio (TDS)
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- What limits you
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An estimate for planning, not a mortgage approval. Qualifying rate per OSFI Guideline B-20: the greater of the contract rate plus 2% or 5.25%. Debt service limits of 39% (GDS) and 44% (TDS) are the standard limits for insured mortgages; lenders apply their own for uninsured ones. Default insurance applies with less than 20% down, is added to the mortgage, and is not available on homes of $1.5 million or more. Thirty-year amortization on an insured mortgage is for first-time buyers and new builds. Lenders also look at credit, employment and the property. A mortgage broker will confirm what you qualify for.
Once you have a price, run it through the mortgage calculator and the closing cost estimator.
Other tools
- Mortgage calculatorMonthly or bi-weekly payment, default insurance and interest on a Canadian mortgage.
- Closing cost estimatorLand Titles fees, legal fees, title insurance, inspection and the cash you need on closing day in Alberta.
- New-home GST rebateGST on a new home and what the new housing rebate and the first-time buyer rebate take off.
- Deposit and draw scheduleWhen your new-build deposits are due, what is left at possession, and how a draw mortgage releases funds.