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Home Affordability Calculator 2020

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We compare estimates for the Big Five Canadian Banks, CMHC, and our advanced model.

Simply the most comprehensive affordability calculator in Canada.

Stress Test Rate Dropping to 4.79%

August 12th, 2020

The stress test rate has fallen by 15 basis points to 4.79%, 40 basis points lower than early 2020 and only 15 basis points above the record-low of 4.64%.

This comes as National Bank followed the rest of the Big 5 in cutting their posted 5-year fixed rate to 4.79% from 4.94%. BMO and CIBC lowered their rates over the weekend and TD and RBC lowered their rates last week.

As of August 12th, 2020, this has been confirmed by the Bank of Canada. Our calculator has been updated to reflect these new changes.

Annual Household Income

Your Income

$ 70,000

Your Partner’s Income

$ 70,000

Enter your annual income before taxes.
Gross Income: $00
Estimated Net Income: $00

How much do you have saved for your down payment?

$ 60,000

First-time home-buyer? You can withdraw up to $35,000 from your RRSP, with no fees or interest, to help increase your down payment.

Where are you looking to buy?

Province

ON

City

Toronto

What type of home are you looking for?

Condo Apt.
Townhouse
Detached House
Not Decided

Monthly Debt Paymentshelp

Some examples include: Credit Card, Student Loan, Car Payment, etc.

$ 0

Enter your average monthly payment. If you have multiple sources of debt, enter the total for your household.

Monthly Non-Housing Expenses

Food & Groceries

$ 1,000

Car & Transport

$ 500

Bills (e.g. Phone, TV)

$ 300

Other Expenses

$ 0

Enter your average monthly expenses in each of the above categories, excluding any housing-related expenses. Exclude your heating costs from your utility bill total.

How is my affordability calculated?

Here’s a breakdown of each factor impacting your home affordability and the limit it places on your asking price. Your affordability is the minimum of all the values shown.

Limiting FactorPurchase Price Limit
Minimum Down Payment$850,000850k
TDS Ratio$60,00060k
GDS Ratio$60,00060k
Total Expenses$1,266,0001.27m
  • Your down payment directly imposes a limit on your maximum asking price.
  • Under CMHC regulations, your total debt service (TDS) ratio cannot exceed 42%. The TDS ratio is calculated by dividing your total annual housing-related and debt expenses by your gross annual income. These expenses include:
    • Your mortgage payment (both principal and interest)
    • Your property tax
    • Your heating costs
    • Half of your condo fees (if applicable)
    • All forms of debt payments
    For TDS purposes, your mortgage payment may be computed at an interest rate higher than your current rate. See the section on stress-testing below for details.
  • Under CMHC regulations, your gross debt service (GDS) ratio cannot exceed 35%. The GDS ratio is calculated by dividing your annual housing-related expenses by your gross annual income. These expenses include:
    • Your mortgage payment (both principal and interest)
    • Your property tax
    • Your heating costs
    • Half of your condo fees (if applicable)
    For GDS purposes, your mortgage payment may be computed at an interest rate higher than your current rate. See the section on stress-testing below for details.
  • Your total monthly expenses cannot exceed your net (after-tax) monthly income.

Stress Testing

Visit our stress-test calculator for more details!

Affordability calculators need to take into account government stress testing regulations published by the Office of the Superintendent of Financial Institutions (OSFI). You must still be able to afford your mortgage payments if your interest rate increases to the greater of

  • the Bank of Canada five-year benchmark rate, currently set to 4.79%, and
  • your current or target interest rate, plus 2% if uninsured. See our stress-test calculator for more details.

Mortgage Information

Want to take a closer look at your potential mortgage payments? Use our Mortgage Calculator to estimate your future payments, find out how different interest rates affect you, and how much you'll pay over the course of your mortgage.

Recent Changes to the Mortgage Stress Test

The CMHC has announced that on July 1st, 2020, they will be changing their guidelines for determining mortgage affordability. These changes include:

  • Qualifying credit scores for mortgage insurance (for mortgages with less than 20% downpayment) will increase to 680 from 600.
  • Gross Debt Service (GDS) and Total Debt Service (TDS) ratio limits will decrease to 35% (from 39%) and 42% (from 44%) respectively.
  • Non-traditional source of down payment funding, such as a personal unsecured line of credit, will no longer count as equity for insurance purposes.
† Results are our estimates only. We provide no guarantee of accuracy; contact each lender for details.
This calculator is provided for general information purposes only. WOWA does not guarantee the accuracy of the information shown and is not responsible for any consequence that arise from the use of the calculator and its results. Any financing products shown are subject to terms and conditions and may not be available in certain regions.