# Mortgage Stress Test Calculator for Home Buyers

> Mortgage lenders test you at a higher rate. See the qualifying payment, the income you need and whether your household passes

On a $500,000 mortgage with a contract rate of 4.99%, the stress test rate is 6.99% and the qualifying payment is $3,498.99 a month. That payment needs about $122,533 of household income. Enter your loan, rate, income and costs and the result tells you if you pass.

## What rate does the stress test use?

The test asks a plain question: could you still pay if rates went up? The qualifying rate is the higher of your contract rate plus 2 percentage points and 5.25%. The federal regulator, OSFI, words it this way for uninsured mortgages:

The greater of the mortgage contract rate plus 2% or 5.25%.

Minimum qualifying rate for uninsured mortgages, [osfi-bsif.gc.ca](https://www.osfi-bsif.gc.ca/en/supervision/financial-institutions/banks/minimum-qualifying-rate-uninsured-mortgages)
You still pay at the contract rate. The higher rate only decides if your income is enough, so a higher qualifying rate makes the bar higher without making your actual payment any bigger than the contract says.

| Contract rate | Qualifying rate | Why |
| --- | --- | --- |
| 2.99% | 5.25% | Floor applies, since 4.99% is lower |
| 3.25% | 5.25% | Both routes give 5.25% |
| 3.99% | 5.99% | Contract rate plus 2 points |
| 4.99% | 6.99% | Contract rate plus 2 points |
| 5.99% | 7.99% | Contract rate plus 2 points |

## Would a $120,000 household pass?

Take a household earning $120,000 that wants a $500,000 mortgage over 25 years at 4.99%. Property tax is $4,000 a year, heating is $150 a month, and there's $500 a month in other debt. The payment at the contract rate is $2,905.18. At the qualifying rate of 6.99% it jumps to $3,498.99.

The calculator adds housing costs to that payment and divides by the 39% housing limit. Then it does the same with debts against the 44% total limit. Whichever answer is higher is the income you need, and here that's $122,533. The household is $2,533 short, so the result reads as not passing.

Cut the contract rate to 3% and the qualifying rate drops to the 5.25% floor. The income needed falls to $108,080, and the same household passes. So would a raise to $130,000 at the original rate.

## What if you don't pass?

Three things can help: a smaller loan, more income on the application, or less debt, depending on which limit is the one holding you back. In the example it's the housing limit, so clearing the $500 debt changes nothing. A $480,000 loan, though, needs only $118,428 and passes. Rerun the tool after each change.

It's easy to get discouraged on a near miss like that. The gap here is about $2,500 of income, which is small next to the $500,000 loan, and one adjustment may close it. Try one change at a time so you can see which lever does the work. If a raise is part of the plan, expect the lender to want proof of it, such as a letter from your employer or a few paycheques at the new amount.

## What does the calculator not know?

The 39% and 44% ratios here are common figures, and lenders can set their own. Half of any condo fee counts toward housing costs. The tool knows nothing about your credit score, your type of job or a co-signer, so a pass isn't an approval. Nor does it know whether your lender is federally regulated, and the details of the rule can differ for other lenders and for insured mortgages, so ask yours which test it applies.

The usual slip is forgetting debts like car loans and card minimums, which push up the income you need. Use a realistic property tax figure too. Skip the wishful number, because a lender will use the real one. To turn income into a price range, try the [mortgage affordability calculator](https://tax-services.ca/calculators/mortgage/mortgage-affordability). For the loan a lender might offer before you start shopping, there's the [mortgage pre-approval calculator](https://tax-services.ca/calculators/mortgage/mortgage-pre-approval). Checking your savings? The [down payment calculator](https://tax-services.ca/calculators/mortgage/down-payment) shows the minimum for a price, and the [mortgage calculator](https://tax-services.ca/calculators/mortgage/mortgage-calculator) sets the payment itself.

## Where we got these figures

The qualifying rule, the greater of the contract rate plus 2% and 5.25%, is OSFI's wording above, from a page last updated in January 2026. The 39% and 44% limits are widely used, but they are common practice and not an official rule, so lenders may differ. Amortization choices are 25 and 30 years. Long amortizations can be limited for insured mortgages, so ask a lender which one you can use. This site has no tie to any government body.

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Source: https://tax-services.ca/calculators/mortgage/mortgage-stress-test
Last updated: 2026-10-10
Independent information site. Not affiliated with the CRA. No services, no guarantee of accuracy. See https://tax-services.ca/disclaimer