Mortgage Affordability Calculator Canada

How much home your income actually buys, using the rules a Canadian lender will apply to your file. The calculator solves for the highest purchase price that keeps you inside both debt-service limits at the qualifying rate, then layers on the tiered down payment minimum and the default-insurance premium to show what you would truly need at closing.

Down payment floor
5 / 10 / 20%
tiered by price band, not a single percentage
Insured price cap
$1.5M
above this, 20% down is mandatory (raised Dec 2024)
Premium range
2.8–4.0%
of the mortgage, by down payment band

The tiered down payment minimum

Canada does not have a single minimum down payment. It has three bands, and they stack, so the effective percentage climbs as the price does. The 20% floor above $1,500,000 is absolute: no insurer will cover a purchase over that price, so no lender will accept less.

Purchase priceMinimum down paymentEffective percentage
$400,000$20,0005.00%
$650,000$40,0006.15%
$900,000$65,0007.22%
$1,200,000$95,0007.92%
$1,600,000$320,00020.00%

Worked example: $140,000 household income

A couple earns $140,000 between them, carries $600 a month in car and credit payments, has $120,000 saved, and is quoted 4.29% on a 25-year amortization. Property tax is estimated at 1% of price and heating at $150 a month. The lender qualifies the file at 6.29% — the contract rate plus two points.

Maximum price
$684,000
mortgage of $564,429 plus the down payment
Qualifying payment
$3,813
principal and interest at 6.29%
Actual payment
$3,144
principal and interest at 4.29%

Loan-to-value lands at 82.5%, so the mortgage is insured and a premium of $15,804 is added to it. The debt-service ratios finish at 38.9% and 44.0% — meaning the second one is binding. This borrower is not limited by income in the abstract; they are limited by $600 a month of consumer debt.

What actually moves the number

Holding everything else at the worked example above, here is what each input is worth in purchasing power. The pattern is worth internalising before you start shopping: consumer debt and interest rates move the answer far more than most buyers expect, and savings move it far less.

ChangeMaximum priceEffect
No other monthly debts$686,626+$2,197
$900 a month of debts$644,897−$39,532
$1,200 a month of debts$605,365−$79,064
Rate at 3.79% instead of 4.29%$708,146+$23,717
Rate at 5.29% instead of 4.29%$641,175−$43,254
30-year amortization$720,276+$35,847

The first three rows show a threshold effect that surprises people. The gap between the two debt-service limits is five percentage points of gross income, which on a $140,000 household is roughly $583 a month. Up to that figure, other debts cost you almost nothing — the housing-only ratio is still the binding one. Past it, every additional dollar of monthly obligation removes about $132 of purchase price. Paying off a $400 car loan can be worth $50,000 of house.

Savings behave differently. Because the mortgage itself is capped by income, additional down payment converts to purchase price roughly one for one rather than being leveraged: at $60,000 down this borrower qualifies for a $565,146 mortgage, and at $200,000 down they qualify for $569,452. The reason to save more is not a bigger mortgage — it is crossing the 20% line and eliminating the insurance premium.

Default insurance premiums

Below 20% down, the mortgage must be insured by CMHC, Sagen or Canada Guaranty. The premium is a percentage of the mortgage, normally added to the loan and amortized with it. The provincial sales tax on the premium cannot be added — it is due in cash at closing, which catches Ontario, Quebec and Saskatchewan buyers off guard.

Down paymentLoan-to-valuePremiumOn a $500,000 mortgage
5% – 9.99%90.01% – 95%4.00%$20,000
10% – 14.99%85.01% – 90%3.10%$15,500
15% – 19.99%80.01% – 85%2.80%$14,000
20% or more80% or lessNone$0

Affordability FAQs

What is the minimum down payment on a home in Canada?▾
The minimum is tiered, not a flat percentage. You need 5% of the first $500,000, 10% of the portion between $500,000 and $1,500,000, and 20% of the entire price above $1,500,000. On a $900,000 home that works out to $65,000, or 7.22% — not the 5% the headline rule implies. The $1,500,000 ceiling came into force in December 2024, raising the previous $1,000,000 cap and pulling a large band of urban purchases back into insured territory.
How much house can I afford on a $140,000 household income?▾
With $120,000 saved, roughly $600 a month of other debt payments, a 4.29% contract rate and a 25-year amortization, the qualifying math lands at about $684,000 — a mortgage of roughly $564,000 plus your down payment. The binding constraint there is TDS, not income in the abstract. Change the debt figure, the amortization, or the rate and the answer moves by tens of thousands of dollars, which is exactly what the calculator is for.
Why does the calculator use a rate higher than the one I entered?▾
Because your lender will. Federally regulated lenders qualify you at the Minimum Qualifying Rate — the greater of 5.25% or your contract rate plus two percentage points — while you pay at the contract rate. A 4.29% mortgage is underwritten at 6.29%. The calculator reports both: the qualifying payment that determines your maximum price, and the lower payment you will actually make. The gap between them is not savings; it is the buffer the rule exists to create.
Does a bigger down payment let me buy a more expensive home?▾
Dollar for dollar, but not more than that. Once your income caps the mortgage, every additional dollar of down payment raises the maximum price by exactly one dollar — it does not unlock extra borrowing. In the worked example on this page, the mortgage sits near $565,000 whether the buyer puts down $60,000 or $200,000; only the purchase price moves. The real gains from a larger down payment are crossing 20% to escape default insurance entirely, and the lower premium bands below it.
What does mortgage default insurance cost?▾
The premium is a percentage of the mortgage amount and steps down as your down payment rises: 4.00% at 5% to 9.99% down, 3.10% at 10% to 14.99%, and 2.80% at 15% to 19.99%. At 20% or more there is no premium. The premium is normally added to the mortgage rather than paid in cash — but the provincial sales tax on it is not: Ontario charges 8%, Quebec 9% and Saskatchewan 6% on the premium, payable at closing out of pocket.
Can I get a 30-year amortization?▾
On an uninsured mortgage — 20% down or more — 30 years is widely available and lowers the qualifying payment enough to move the maximum price meaningfully; in the example on this page it adds about $36,000 of purchasing power. On an insured mortgage the 30-year option is restricted, extended in December 2024 to first-time buyers and to purchases of newly built homes. Stretching the amortization always costs more interest over the life of the loan; it buys approval and cash flow, not savings.
What income will lenders actually count?▾
Salaried base income is counted in full from a letter of employment and a recent pay stub. Bonus, commission and overtime are typically averaged over two years and only counted with a two-year history. Self-employed applicants are usually assessed on two years of Notices of Assessment, though lenders with business-for-self programs will consider add-backs. Rental income is counted through an offset or an add-back method depending on the lender, and the two produce materially different qualifying results on the same property.

Buying research

GDS and TDS ratios explained →
What goes into each ratio, and how to tell which one is binding on your file.
The December 2024 reforms →
The $1.5M insured cap, 30-year amortizations, and who they actually help.
The insured mortgage advantage →
Why a smaller down payment often comes with a lower rate.
25 vs 30 year amortization →
Eligibility, cost, and what the extra five years really buys.
First-time buyer programs →
Rebates, credits and incentives, and how they stack.
Self-employed income →
How business-for-self income is documented and what lenders will count.
Worked example: salaried buyer →
Full qualification walkthrough on a single salaried income.
Worked example: FHSA plus RRSP →
Stacking tax-advantaged accounts into a larger down payment.
How the ratios are calculated →
Short answer with sources, from the Ratellow FAQ canon.
Land transfer tax calculator →
The closing-day cash your down payment budget also has to cover.

Mortgage Affordability Calculator Canada

See how much home you can afford based on your income, debts, and down payment — calculated using Canada's official GDS/TDS qualification rules.

Parameters

Combined household income before taxes

Cards

Car

Other

Total: $500/mo

Cash available for down payment

Today's best 3yr fixed

30yr only for ≥20% down

Lenders typically use ~$150/mo

50% counted for qualification

Affordability Report
Stress Test6.29%
Maximum Purchase Price
$441,010
Based on $100,000 income
cmhc required
Maximum Mortgage
$391,010
$50,000 down payment
Est. Monthly Payment
$2,184
At 4.29% contract rate
CMHC PremiumFinanced
$12,121
Added to mortgage principal
Limiting FactorDebts
TDS
Total debts limiting factor
Qualification Ratios
GDS
38.0%of 39% limit
TDS
44.0%of 44% limit
Qualified at 6.29% stress test rate
Monthly Housing Costs
Mortgage (P&I)$2,184
Property Taxes$368
Heating$150
Total Monthly Housing$2,702

At your max affordable price of $441,010

Ready to run the numbers?

Calculate your exact payment at your target price.

Payment Calculator

How this works: Canadian lenders use two key ratios to determine how much you can borrow:

  • GDS (Gross Debt Service): Housing costs must be 39% or less of gross income
  • TDS (Total Debt Service): All debts must be 44% or less of gross income

Lenders also apply the stress test — qualifying you at the higher of your rate + 2% or 5.25%.

You Can Afford
$441,010
Calculate Payment