Home Affordability Calculator
Total debt servicing ratio (TDSR) is the most important factor in determining home affordability or how big a mortgage the bank will give you. TDSR is a measure of your ability to make your monthly debt payments based on your income.
To calculate your TDSR, add up all of your monthly debt payments, including your mortgage (or rent), credit card payments, car loan payments, utilities and any other debts payments you have and enter it into the calculator. Now enter your total household income before taxes.
In general, you need a TDSR of no more than 0.44% or less than 44% of your gross income.
Monthly Payment:
Total Debt Servicing Ratio:
How to use the home affordability calculator
Now, lets figure out the payment for your new home to see if you it fits within your TDSR
Principal: This is the amount of funds you will require after your dow payment. Ex: purchase price $350,000, 10% down payment $35,000, principal $315,000.
Interest rate: Canadian banks post their current mortgage rates on their websites. Use a current rate in the calculator to ensure accuracy.
Use the mortgage payment from the calculator and replace your current mortgage or rent payment used in the TDSR calculator with the new mortgage payment.
Now play with some different house prices to see what you can afford while staying under 44% TDSR.
