Free · The way underwriters run them
GDS / TDS Ratio Calculator
The two ratios that decide whether a Canadian mortgage application passes — calculated the way an underwriter does, including the inclusion rules nobody writes down.
Your file
- Binding
- TDS
- Room
- $805
- Supports
- $720,244
- You asked
- $600,000
The payment being tested
Not the $3,317.50 you would pay — the $4,015.31 a lender qualifies you at, 6.49% rather than 4.49%.
That is $697.80 a month added to what your ratios are measured against. Running them on your real payment is the most common way a failing file looks like a passing one.
Your $6,000 of revolving balances counts as $180.00 a month against you, regardless of whether you clear it every month. The ratios measure exposure, not behaviour.
A failing ratio at one lender is not a failing ratio everywhere. Limits and appetite differ, which is exactly why shopping across lenders exists — take the numbers to a broker rather than back to the same bank.
Talk to a brokerBoth ratios, against both sets of limits
Insured lending caps GDS at 39% and TDS at 44%. Some uninsured lenders apply 35% and 42% instead — worth asking which yours uses if you are putting 20% or more down.
How your housing cost is counted
The inclusion rules are not intuitive, and they are where most surprises live.
- Qualifying mortgage paymentAt 6.49%, not your 4.49% contract rate
- $4,015.31
- Property taxCounted in full
- $400.00
- Heating allowanceA standard figure, not your actual bill
- $100.00
- PITH
- $4,515.31
- Everything else you oweLoan payments, plus 3% of revolving balances — $180.00 here, whatever you actually pay
- $730.00
Against the insured limits
- GDS — housing costs alonePasses the 39% limit
- 32.8%
- TDS — housing plus every other debtPasses the 44% limit
- 38.1%
- The binding ratioOther debt is the constraint, so paying it down is the faster lever
- TDS
- Room a month
- $805
The payment the ratios actually use
- Your contract paymentAt 4.49% — what you would really pay
- $3,317.50
- The qualifying paymentAt 6.49% — the stress test, and what the ratios are run on
- $4,015.31
- The differenceEvery ratio on this page is computed on the higher figure
- $697.80
How PITH is built
- Qualifying mortgage paymentAt 6.49%, not your 4.49% contract rate
- $4,015.31
- Property taxCounted in full
- $400.00
- Heating allowanceA standard figure, not your actual bill
- $100.00
- PITH
- $4,515.31
- Everything else you oweLoan payments plus 3% of revolving balances
- $730.00
- Monthly income
- $13,750
What the ratios would support
- Maximum housing costThe lower of the two limits
- $5,320
- Which is a mortgage ofAt 6.49% over 25 years, after the other housing costs
- $720,244
- Room above what you asked for
- $120,244
Against the tighter conventional limits
- GDSPasses the 35% limit
- 32.8%
- TDSPasses the 42% limit
- 38.1%
- Mortgage supportedSome uninsured lenders apply these instead — ask which yours uses
- $644,409
Ratios are computed on the qualifying payment — the greater of your rate plus two points and the 5.25% floor — not the payment you would make. Condo fees count at half, property tax, heat and site fees in full, and revolving balances at 3% of the balance regardless of what you pay. Conventional limits are common but not universal among uninsured lenders. These two ratios are the debt-service portion of an underwriting decision, not all of it: credit history, employment and the property matter too, and lenders differ in both limits and appetite. An estimate for planning, not an approval.
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What the GDS / TDS Calculator does
These two ratios are the debt-service half of every Canadian mortgage decision. Gross Debt Service measures your housing costs against your income; Total Debt Service adds everything else you owe. This runs both the way an underwriter does, including the inclusion rules almost nobody sees written down.
It is built for the moment after a bank has said no, or a pre-approval came back lower than expected, and someone mentioned a ratio and moved on. It shows the actual numbers, names which ratio is binding, and quantifies what would fix it — in dollars you can act on rather than a percentage you can only stare at.
- Both ratios against the insured limits and the tighter conventional ones
- Which ratio is binding, and therefore which lever to pull
- Your room or shortfall in dollars a month, not just a percentage
- The mortgage the ratios would actually support
- Quantified fixes: how much debt to clear, how much income to add
The mistake that makes a failing file look fine
Your ratios are not run on the payment you would make. They are run on a stress-tested one, at the greater of your rate plus two points and a 5.25% floor.
On a $600,000 mortgage at 4.49%, that is the difference between a $3,317 payment and a $4,015 one — nearly $700 a month added to the figure your ratios are measured against. Anyone who enters their real payment gets a comfortable-looking result and a declined application.
That is why this page asks for the mortgage rather than the payment. The qualifying figure is worked out for you, and both are shown side by side, because the gap between them is worth seeing once.
- Lenders qualify at the greater of your rate + 2% and 5.25%
- On a typical file that adds several hundred dollars a month
- Ratios computed on the contract payment are meaningfully too low
- Enter the mortgage; the qualifying payment follows from it
- Both figures are shown, so the gap is visible rather than assumed
The inclusion rules nobody tells you
Each input is treated by an underwriter with a specific rule, and the rules are not intuitive.
A **credit card balance** counts at 3% of the balance every month, whatever you actually pay. Clearing it in full each month does not help — the ratio measures exposure, not behaviour. On a $6,000 balance that is $180 a month of qualifying room, gone, for a card you might never carry.
A **condo fee** counts at only half, though you pay all of it. That is near-universal in Canada, and it produces the odd result that a condo buyer can qualify for more than a freehold buyer on the same income while actually having less left over each month.
**Property tax, heating and site fees** count in full. Heating is a standard allowance rather than your real bill.
- Credit cards and unsecured lines: 3% of the balance, regardless of payment
- Condo fees: half counts, though you pay all of it
- Property tax, heat and site fees: counted in full
- Car loans, student loans and support paid out: at their stated payment
- A secured HELOC is often amortized instead — ask which applies to yours
Which ratio is binding, and what it tells you
The two ratios fail for different reasons, and knowing which one is binding tells you which lever actually works.
If **GDS** is binding, the housing cost itself is too high for the income. Other debt is not the problem, and paying it down will not help. The fixes are a lower price, a larger down payment, or a longer amortization.
If **TDS** is binding — the more common case — the mortgage would be affordable if the other debts were not there. Clearing revolving credit is usually the fastest route, because of that 3% rule: every $1,000 cleared frees $30 a month of room, immediately.
The page names the binding ratio and sizes each fix, so the next step is a decision rather than a guess.
- GDS binding: the housing payment is the problem
- TDS binding: the other debt is the problem
- Every $1,000 of revolving credit cleared frees $30 a month
- A longer amortization lowers the qualifying payment and helps both
- Adding a co-applicant raises the denominator of both at once
Using your results well
If TDS is binding, run it again with the card at zero to see exactly what that balance is costing you in qualifying room. The figure is usually larger than people expect.
If you are putting 20% or more down, check which limits your lender uses. Some uninsured lenders apply the tighter 35% and 42% figures rather than the insured 39% and 44%, and it is not consistent across the market.
And take a failing result to a broker rather than back to the same bank. These ratios are the debt-service portion of a decision, not all of it — credit history, employment stability and the property matter too, and different lenders apply different limits and different appetite. Two identical files genuinely do get different answers, which is the whole reason shopping across lenders exists.
- Model your card at zero to see what it costs you in room
- Check whether your lender uses insured or conventional limits
- A failing ratio at one lender is not a failing ratio everywhere
- Room matters as well as passing — 43.9% reads very differently from 35%
- Confirm 30-year eligibility before relying on a longer amortization
Common questions
What are GDS and TDS?
GDS (Gross Debt Service) is your housing costs — the qualifying mortgage payment, property tax, heat and half your condo fee — divided by gross income. TDS (Total Debt Service) adds every other debt on top. Insured lending typically caps them at 39% and 44%; some uninsured lenders use 35% and 42%.
What payment do the ratios actually use?
Not the one you would pay. Lenders qualify at the greater of your contract rate plus two percentage points and a 5.25% floor. On a $600,000 mortgage at 4.49% that turns a $3,317 payment into $4,015 — so ratios calculated on your real payment come out meaningfully too low. This page computes the qualifying figure for you rather than asking you to supply it.
Why does my credit card count against me if I pay it off monthly?
Because lenders assume you could carry 3% of the balance as a monthly obligation, and the ratio measures that exposure rather than your behaviour. A $6,000 balance costs $180 a month of qualifying room whether you clear it religiously or never touch it. Paying it down before you apply removes the figure entirely.
Do condo fees really only count at half?
Yes — that is the standard convention across virtually every Canadian lender, not an oversight. It means a condo buyer can qualify for more than a freehold buyer on an identical income, while actually having less money left at the end of the month. Worth remembering when the approval feels generous.
What is a good ratio?
Anything under the limit passes, but room matters. A file at 35% GDS reads very differently to an underwriter than one at 38.9%, even though both technically qualify — the second has no capacity for a rate rise or a change in circumstances, and experienced underwriters treat it accordingly.
What should I do if I fail?
It depends which ratio is binding. If TDS, clearing revolving credit is usually fastest — every $1,000 frees $30 a month. If GDS, the housing cost itself has to come down through a lower price, a bigger down payment or a longer amortization. This page sizes each option for your numbers rather than listing them generically.
Does passing these ratios mean I am approved?
No. They are the debt-service portion of the decision. Credit history, employment stability, the down payment source and the property itself all matter alongside them, and lenders differ in both their limits and their appetite. Passing here means the arithmetic is not what stops you.
Next step
A no from one lender is not a no from the market.
Limits differ, appetite differs, and how income is treated differs — which is why two identical files genuinely get different answers. A broker can place a file that one bank declined, and can tell you which of these numbers is actually worth fixing first. Mortgage Directory lists licensed brokers across Canada — placement is never sold, and an enquiry goes to one broker only.