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Mortgage Affordability Calculator

How much home can you afford? Use our free mortgage affordability calculator to instantly estimate your maximum purchase price and monthly payments.

At A Glance

  • Lenders use three separate rules — not just your rate — to set your borrowing capacity
  • Debt Service Ratios: housing costs capped near 39% of income; total debt near 44%
  • Minimum Down Payment: 5% up to $500K, 10% to $1.5M, 20% above $1.5M
  • Stress Test: qualify at your rate + 2%, or OSFI’s minimum rate, whichever is higher
  • The qualifying rate changes periodically, so always use current numbers
  • This calculator applies all three rules together, like a real lender
Mortgage Affordability Calculator | Homes by Lei
1 Property & Down Payment
2 Income & Housing Costs
3 Mortgage Terms & Payment

Property & down payment

Determines your insured mortgage price cap and maximum amortization.
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Canada's minimum down payment tiers Insured cap: $1,500,000
5%
5% + 10%
20%+
$0 $500K $1.5M $2M+
5% on first $500,000
+10% on the portion $500,000–$1.5M
20% minimum — no CMHC insurance available
Minimum down payment required: $29,100 (5.00%). Your entered down payment is above the minimum.

Income & housing costs

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Car loans, credit cards, lines of credit, student loans, support payments.
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$
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50% counted toward GDS/TDS.
Qualifying ratios
Gross Debt Service (GDS)0.00%
Total Debt Service (TDS)0.00%
Qualifying monthly housing cost$0
Guideline maximums39% / 44%
Both ratios are within typical lender guidelines.

Mortgage terms & payment

%
Up to 30 years available for first‑time buyers / new builds on insured mortgages.
Insurance premium (if applicable) is added to the loan and amortized with it.
Payment summary
Mortgage amount (before premium)$0
CMHC insurance premium (est.)$0
Total mortgage amount$0
Payment at contract rate$0
Payment at qualifying (stress‑test) rate$0
Total interest over term$0
Balance remaining at maturity$0
Figures are estimates for discussion purposes only and do not constitute a mortgage pre‑approval or loan commitment. GDS/TDS guidelines (39% / 44%) and stress‑test rate (greater of contract rate + 2% or 5.25%) reflect typical OSFI B‑20 / insured‑lending benchmarks; actual thresholds vary by lender and credit profile. Minimum down payment tiers (5% up to $500,000, plus 10% on the portion up to $1.5M, 20% minimum at $1.5M and above) and insured‑mortgage price caps ($1.5M for first‑time buyers/new builds, $1M for resale/repeat buyers) reflect federal rules in effect as of the December 2024 mortgage reforms — confirm current figures with your lender before relying on them.

How Mortgage Affordability Is Calculated in Canada

When you apply for a mortgage, Canadian federally regulated lenders don’t simply check whether you can afford the interest rate you’re being offered. Your actual borrowing capacity is shaped by three distinct rules working together — and understanding each one is the difference between guessing what you can afford and knowing it.

1. Debt Service Ratios

Lenders measure your housing costs and total debt load against your income using two ratios:

  • Gross Debt Service (GDS) — your mortgage payment, property tax, heating costs, and (if applicable) condo fees, as a share of your gross income. Most lenders want this at or below roughly 39%.
  • Total Debt Service (TDS) — everything in GDS, plus your other debts: car loans, credit cards, student loans, lines of credit. This ceiling typically sits around 44%.

These aren’t hard legal limits — individual lenders can be more conservative, or occasionally more flexible for strong applicants — but they’re the industry-standard starting point every mortgage calculation works from.

2. Minimum Down Payment Tiers

Canada uses a tiered system rather than one flat percentage:

  • 5% on the portion of the purchase price up to $500,000
  • 10% on the portion between $500,000 and $1.5 million
  • 20% minimum once the purchase price reaches $1.5 million — at that point, mortgage default insurance is no longer available, so 20% becomes mandatory rather than optional

Your down payment size doesn’t just affect your loan amount — it determines whether you fall into “high-ratio” territory (under 20% down), which triggers CMHC insurance and changes the math on your monthly payment.

3. The Federal Mortgage Stress Test

Set by the Office of the Superintendent of Financial Institutions (OSFI), the stress test requires you to qualify not at your actual contract rate, but at whichever is higher: your contract rate plus 2%, or a minimum qualifying benchmark rate that OSFI sets and periodically adjusts. This exists to make sure you could still comfortably manage your payments if rates rise after you’ve locked in — it’s a buffer, not a rate you’ll actually pay.

Because this benchmark rate changes periodically, the exact qualifying rate today may differ from what it was even a few months ago — which is exactly why running your numbers through an up-to-date calculator matters more than relying on a number you saw somewhere else.

Putting it together: your real borrowing capacity is whichever of these three rules is most restrictive for your situation — not just the one that sounds most favourable. Our calculator runs your income, debts, and down payment through all three simultaneously, the same way a lender actually will.