RateReset Canada guide
How the Canadian mortgage stress test works
Understand the qualifying rate, debt-service ratios, and why passing is not approval.
The qualifying rate
When it applies, the configured test uses the greater of 5.25% or the contract rate plus two percentage points. Because rules can change, every threshold carries a version, effective date, verification date, and official source.
OSFI does not expect federally regulated lenders to apply the prescribed minimum qualifying rate to an uninsured straight switch at renewal when neither the loan amount nor the remaining amortization increases. Refinancing, taking equity out, or extending amortization is different and generally involves new underwriting.
Rates are only one part
Gross debt service compares housing costs to gross income. Total debt service adds other recurring debts. Lenders also assess credit, documentation, property, and product eligibility.
Qualification is not comfort
A household budget includes taxes, repairs, childcare, transportation, savings, and income variability that a maximum ratio may not capture. Treat the estimate as a ceiling test, not a recommendation.
Estimates are for educational purposes and may differ from lender calculations, contractual terms, taxes, fees, or regulatory requirements. Read the full disclaimer.
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Methodology version: mortgage-methodology-2.0. See the editorial policy and corrections process.