Estimate how much home you might afford using simplified 2026-style rules: Canada (GDS/TDS, stress test, CMHC tiers) and the United States (28/43 DTI, conforming limit, PMI). This is an educational illustration only — not a mortgage pre-approval or lender decision.
Maximum home price you can afford
$319,661
Based on your income of $85,000, you qualify for a home up to $319,661.
Maximum mortgage (before CMHC)
$279,661
CMHC insurance premium
$8,669
Total mortgage (with CMHC)
$288,330
Estimated monthly payment
$1,771
Stress test rate used
7.50%
Cash needed to close (est.)
$53,464
Bar length: 100% = limit; dashed line marks the cap.
Bar length: 100% = limit; dashed line marks the cap.
Ratios are within the illustrated GDS/TDS limits and down payment meets the minimum for this max price.
The Canada tab uses a stress-tested mortgage payment to derive a maximum loan from GDS (39%) and TDS (44%) allowances, subtracting fixed monthly property tax and heat placeholders. CMHC-style premiums apply when equity is under 20%. The USA tab applies front-end (28%) and back-end (43%) limits with fixed monthly tax and insurance placeholders and PMI when down payment is under 20%.
In Canada, lenders use GDS and TDS ratios to determine affordability. Your GDS ratio (mortgage, taxes, heat) must not exceed 39% of gross income, and your TDS ratio (all debts) must not exceed 44%. All mortgages are also subject to the stress test at the higher of your contract rate plus 2% or 5.25%.
The Canadian mortgage stress test requires you to qualify at the higher of your contract rate plus 2% or 5.25%, whichever is greater. This ensures you can still afford payments if rates rise.
In Canada, the minimum down payment is 5% for homes under $500,000. For homes between $500,000 and $999,999, it is 5% on the first $500,000 and 10% on the remainder. Homes over $1 million require a 20% down payment.
US lenders use the 28/43 rule: your monthly housing costs should not exceed 28% of gross income, and total debt payments should not exceed 43%. With a $100,000 annual income and no other debts, you may qualify for a home around $400,000–$450,000 depending on rates and down payment.
CMHC insurance is required for Canadian mortgages with less than 20% down payment. The premium ranges from 2.80% to 4.00% of the mortgage amount depending on your down payment percentage. It is added to your mortgage and paid over the amortization period.
Last updated: March 2026 | Educational estimates only. Not financial, legal, or lending advice.