Ontario mortgage help

Mortgage stress test in Canada

Federally regulated lenders generally qualify borrowers using the higher of 5.25% or the contract rate plus two percentage points, even though the actual payment uses the contract rate.

Reviewed September 1, 2026Published by Ontario Mortgage HelpHow we review

What to do first

  1. Calculate the qualifying rate using the higher of 5.25% or the offered contract rate plus two percentage points.

  2. List gross household income, property tax, heating, half of condominium fees, and all monthly debt obligations.

  3. Estimate both gross debt service and total debt service using the qualifying payment.

  4. Keep a separate household budget because passing the stress test does not establish that the payment is comfortable.

Important considerations

Qualification and payment use different ratesThe qualifying rate tests repayment capacity. The scheduled mortgage payment is normally calculated using the actual contract rate.

Both insured and uninsured mortgages are coveredFCAC states that the minimum qualifying rate applies to insured and uninsured mortgages at federally regulated lenders.

Approval includes more than ratiosCredit, income treatment, down payment, documentation, the property, insurer rules, and lender policy may still change the result.

Official sources

Preparing to get a mortgageFinancial Consumer Agency of CanadaGetting pre-approved for a mortgageFinancial Consumer Agency of CanadaMortgage application processFinancial Services Regulatory Authority of Ontario

Related mortgage help

Buying a homeEstimate the payment, closing costs, and a workable budget.First-time home buyerPlan the down payment, taxes, closing costs, and financing.Mortgage pre-approvalUnderstand the budget, rate hold, documents, and limits.