Mortgages
How much mortgage can I afford in Canada?
Affordability is set by three limits at once:
- GDS ratio — mortgage payment, property taxes, heat, and half of condo fees must stay under roughly 39% of gross income.
- TDS ratio — those costs plus car loans, student loans, lines of credit and credit-card minimums must stay under roughly 44%.
- Stress test — the payment is calculated at the greater of contract rate + 2% or 5.25%, so your approval is smaller than your actual payment suggests.
Minimum down payment is 5% up to $500,000, 10% on the portion from $500,000 to $1.5M, and 20% above that. Anything under 20% requires CMHC-style default insurance, which is added to your mortgage balance.
Related Questions
How much mortgage can I afford in Canada?
Lenders cap housing costs at about 39% of gross income (GDS) and all debt payments at about 44% (TDS), and qualify you at the stress-test rate — the greater of your contract rate plus 2% or 5.25%.
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