Canada · CAD · Mortgage & qualification
Mortgage Stress Test
Compare contract-rate payments with a standard qualifying-rate scenario and GDS/TDS.
Reference scope documented 2026-10-25: standard qualifying rate max(contract + 2 percentage points, 5.25%); purchase insurance cap below CAD 1.5 million; 30-year insured scenarios require confirmed eligibility. Enter current personal quotes; these rules do not establish approval. CMHC source · OSFI source.
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Educational estimate, not financial advice. Disclaimer · Methodology · Corrections.
How this estimate works
Standard qualifying rate = max(contract rate + 2 percentage points, 5.25%). The financed purchase balance is tested at this rate. Tax, heating, half condominium fees and ground rent are included before calculating GDS/TDS.
Assumptions and limits
- Standard owner-occupied 1–2 unit purchase with traditional cash down only. Minimum down is 5% of the first CAD 500,000 plus 10% above it below CAD 1.5 million; at CAD 1.5 million or more the model requires 20%.
- The high-ratio CMHC tiers are 2.8%, 3.1% and 4.0% at base LTV up to 85%, 90% and 95%. Amortization above 25 years adds 0.20 percentage points and requires confirmed first-time-buyer or new-build eligibility, up to 30 years.
- At least 20% cash down gives zero borrower-paid high-ratio premium in this model, which does not mean all lender insurance is absent. Provincial premium tax is entered separately and paid in cash.
- This does not decide loan approval or apply every insured/uninsured exception. For qualifying stand-alone uninsured mortgages switched between federally regulated lenders at renewal, OSFI does not prescribe the MQR. Remaining contractual amortization cannot increase. Up to CAD 3,000 may be added for related transaction costs; equity take-out is not permitted. Lenders still assess repayment capacity. Confirm the full scope with the lender.
References and further reading
Worked Canada example: Mortgage Stress Test
This is a hypothetical arithmetic example in CAD, not a current lender quote, market observation or borrower record. The same calculator model produces the figures below. Its input assumptions are shown so that you can reproduce or change the scenario.
| Assumed input | Illustration value |
|---|---|
| Purchase price (CAD) | 700,000 |
| Cash down payment (CAD) | 70,000 |
| Amortization remaining (years) | 25 |
| 30-year insured first-buyer/new-build eligibility confirmed? | No / not confirmed |
| Finance the CMHC premium? | Yes — add to principal |
| Applicable provincial premium tax (%) | 0 |
| Contract annual rate (%) | 3.99 |
| Contract compounding | Semiannual — typical Canadian fixed-rate convention |
| Annual gross qualifying income (CAD) | 150,000 |
| Annual property tax (CAD) | 3,000 |
| Monthly heating (CAD) | 120 |
| Full monthly condominium fee (CAD) | 0 |
| Monthly ground / site rent (CAD) | 0 |
| Other monthly debt payments (CAD) | 0 |
| Calculated measure | Result |
|---|---|
| Standard qualifying-rate scenario | 5.99% |
| Monthly P&I at contract rate | CA$3,413.14 |
| Monthly P&I at qualifying rate | CA$4,151.88 |
| Qualifying monthly housing costs | CA$4,521.88 |
| Scenario GDS | 36.175007% |
| Scenario TDS | 36.175007% |
Amounts use unrounded intermediate arithmetic and are rounded only for display. Selecting different costs, rates, payment dates or terms changes the result; no illustration value is prefilled into your personal financial fields.