How do GDS and TDS ratios impact mortgage approvals, and what can borrowers do to improve them?
Gross Debt Service (GDS) and Total Debt Service (TDS) ratios are key indicators of a borrower's ability to manage debt.
Key Points
Your GDS and TDS ratios show lenders if you can comfortably afford your mortgage and other debts.
Lenders will look at your income and debts carefully to make sure you can handle different financial situations.
When you apply for a mortgage, lenders consider current and possible future interest rate changes.
The government reviews the mortgage qualifying rate each year to ensure it's appropriate.
Primary sources
Primary sources cited by the Ratellow Research Team. Editorial standards · Correction policy
Related Questions
How does the stress test affect my 2026 renewal options?
Same-lender renewals and uninsured straight switches (OSFI, November 21, 2024) are exempt from the prescribed MQR. A refinance, an insured switch, or any increase in loan amount still requires the stress test — greater of 5.25% or contract + 2%.
What's the difference between insured and uninsured mortgage renewals?
Insured mortgages face stricter CMHC/Sagen constraints while uninsured mortgages enjoy flexible OSFI-only guidelines.
Should I consider switching lenders or negotiate with my current lender?
Your switching decision hinges on rate differential versus requalification risk, with break-even analysis determining optimal strategy.
When should I start my mortgage renewal process?
Start your renewal process 120-180 days before your current term expires to maximize your strategic options.