What the calculator shows
Enter price, down payment, contract rate and amortization. Add household income, property tax, heating, condo fees and other debt to compare the contract payment with the federal mortgage stress-test payment and CMHC debt-service guidelines.
Calculation method
Canadian fixed mortgage interest is converted from nominal semi-annual compounding to an equivalent monthly rate. A down payment below 20% adds the applicable CMHC premium to principal; insured amortization beyond 25 years adds the published 0.20-percentage-point surcharge. Qualification uses the greater of the contract rate plus two percentage points or 5.25%, with 39% GDS and 44% TDS reference limits.
Inputs to confirm
Replace the dated Bank of Canada starting rate with the lender quote. The premium model assumes a standard owner-occupied CMHC loan and traditional down payment; confirm eligibility, first-time-buyer or new-build status, amortization, premium adjustments, property costs and debts with the lender and insurer.
Worked example
For a CA$750,000 home with CA$60,000 down, a 4.19% contract rate and 25-year amortization, the base mortgage is CA$690,000. At 92% loan-to-value, the modeled CMHC premium is 4%, or CA$27,600, producing an insured principal of CA$717,600. The contract payment is CA$3,849.00 a month. Qualification uses 6.19%, giving a CA$4,672.61 qualifying payment. With CA$140,000 household income, CA$5,000 annual property tax, CA$150 monthly heat and CA$500 other debt, GDS is 44.91% and TDS is 49.19%.
Input variations
| Scenario | Insurance premium | Contract payment | Qualifying payment | GDS / TDS |
|---|---|---|---|---|
| CA$60,000 down, 25 years | CA$27,600 | CA$3,849.00 | CA$4,672.61 | 44.91% / 49.19% |
| CA$150,000 down, 25 years | CA$0 | CA$3,218.22 | CA$3,906.86 | 38.34% / 42.63% |
| CA$60,000 down, eligible 30 years | CA$28,980 | CA$3,496.61 | CA$4,362.39 | 42.25% / 46.53% |
The 30-year scenario lowers the monthly payment but adds the modeled 0.20 percentage-point premium surcharge and more total interest. Eligibility for an insured 30-year amortization must be confirmed separately.
Differences from official documents
This is a planning model, not a lender approval or CMHC insurance decision. It does not model credit score, income stability, rental income treatment, closing costs, land-transfer tax, premium sales tax, lender-specific debt adjustments or every first-time-buyer and new-build rule. The payment also assumes the entered rate stays fixed for the full amortization, rather than renewing by term.
Thresholds and limits
The minimum down payment modeled is 5% of the first CA$500,000 and 10% of the portion up to CA$1.5 million. A loan above 80% loan-to-value is treated as insured, subject to the modeled eligibility limits. The qualifying rate is the greater of 5.25% or the contract rate plus two percentage points. GDS of 39% and TDS of 44% are shown as reference ceilings, not guarantees.
Documents to check
Use the accepted purchase agreement, proof of down payment, lender rate quote, property-tax bill or listing, heating estimate, condo statement and current debt payments. Confirm income with pay statements, T4 slips, Notices of Assessment or the lender’s requested self-employment documents, then compare the result with the lender disclosure and insurance decision.
Four separate tests shape the Canadian mortgage scenario
Down payment, mortgage insurance, Canadian interest conversion and the qualifying rate can each change the result before a lender considers the rest of an application.
Down payment controls both principal and insurance
The statutory minimum changes with purchase price. Below 20% down, the modeled CMHC premium is added to the loan; provincial tax on that premium and non-standard down-payment treatment remain outside the financed balance.
Contract payment and qualifying payment use different rates
The contract payment uses the entered rate after Canadian semi-annual-to-monthly conversion. Qualification uses the greater of 5.25% or contract rate plus two percentage points, so it can be materially higher.
GDS and TDS are screening ratios, not approval
GDS combines qualifying housing costs; TDS adds other debt. The displayed 39% and 44% references are useful comparisons, but lenders also review verified income, credit, property, loan purpose and insurer eligibility.