The mortgage stress test, explained

What is the mortgage stress test rate in 2026?

OSFI’s page on the minimum qualifying rate (MQR) for uninsured mortgages sets it at the greater of the mortgage contract rate plus 2% or 5.25%, and says OSFI reviews the floor and buffer at least annually. The page was last modified January 29, 2026. The last dedicated OSFI announcement we found confirming the level is from December 12, 2023, and OSFI’s January 2026 quarterly release said its existing B-20 debt-service expectations continue.

For insured mortgages (less than 20% down) the federal government applies the same formula, and CMHC uses it when calculating your GDS and TDS ratios. FCAC’s consumer guide states it for both: the higher of 5.25% or your negotiated rate plus 2%.

What do GDS and TDS measure in the stress test?

The lender calculates your payment at the qualifying rate, adds property tax, heating and (for condos) half the fees, and divides by your gross income. That is your gross debt service ratio (GDS). Add your other debt payments and you get total debt service (TDS).

CMHC’s limits for insured mortgages are 39% GDS and 44% TDS, with a minimum credit score of 600 for at least one borrower. FCAC gives the same 39% and 44% as guidance. For uninsured mortgages each bank sets its own limits within OSFI’s expectations.

Try your own numbers in the stress test calculator.

Do you have to pass the stress test again at renewal?

If you renew with your current lender, you are not re-qualified. Since November 21, 2024 OSFI no longer prescribes the MQR for uninsured straight switches: moving your mortgage to a new lender at renewal with no increase in the amount or amortization (OSFI allows up to $3,000 to be added for transfer costs).

For insured mortgages, the federal government announced on December 12, 2023 that borrowers do not have to requalify when they switch lenders at renewal, and restated it when the December 15, 2024 reforms took effect. This makes it much easier to take a better offer from another bank at renewal; see the renewal checklist.

What are OSFI’s loan-to-income limits?

Since each lender’s 2025 fiscal year, OSFI has applied a loan-to-income (LTI) limit: a cap on the share of a lender’s new uninsured mortgages that exceed 4.5 times the borrower’s income. It is set per institution and measured across the portfolio, not applied to each loan, and the caps for individual banks are not published. OSFI said in January 2026 that the framework continues.

In practice: a high multiple of income is not automatically refused, but a bank that is near its cap may be more selective.

When does the 5.25% floor apply instead of your rate plus 2?

The floor only decides your qualifying rate when your contract rate is below 3.25%. Above that, rate + 2 is higher. On November 2, 2026 every big bank’s published 5-year fixed and variable special was above 3.25%, so for these offers it is the 2-point buffer that sets the test, and every 0.25 point you negotiate off your rate also takes 0.25 point off your qualifying rate.

How much do car loans and credit cards reduce what you can borrow?

Other debts only count in TDS, and the TDS limit (44%) is 5 points above the GDS limit (39%). So on a $100,000 income, roughly the first $417 a month of other debt payments doesn’t lower your maximum at all: GDS is the limit that binds. Past that point, every $100 a month of debt payments cuts the largest mortgage by about $14,103.

The table uses RBC’s 5.14% 5-year special (qualifying at 7.14%), a 25-year amortization, $3,600 a year of property tax and $100 a month of heating, with CMHC’s 39% / 44% limits.

How can you pass the stress test with a bigger margin?

• Pay off or pay down other debts before you apply, once they are large enough to push TDS past GDS (see above).
• Use a 30-year amortization if you qualify for one (insured first-time buyers and new builds). At 7.14%, the qualifying payment per $100,000 borrowed falls from $709.08 over 25 years to $667.73 over 30, at the cost of more interest over the life of the loan.
• Negotiate the rate. With rate + 2 binding, a lower contract rate lowers the test too.
• Count all the costs the lender will count: property tax, heating and, for a condo, half the fees go into GDS.
• Run the numbers before you shop with the stress test calculator, then get a pre-approval with a rate hold.

Worked example: $120,000 income, $480,000 mortgage

At RBC’s 5.14% 5-year special (November 2, 2026), you’d qualify at 7.14%. The payment you’d actually make is $2,830.08 a month; the payment you must qualify at is $3,403.59.

With $4,000 property tax, $100 a month heating and $400 of other debt payments, GDS is 38.4% and TDS 42.4% against CMHC’s 39% / 44%. The largest mortgage these limits allow is about $488,896.

Computed by this site’s engine from each bank’s published rates (November 2, 2026) and the rules cited below. An example, not a quote.

What this means for you

• Paying off a car loan or card before applying raises your maximum more than a small rate discount does.
• A 30-year amortization (insured first-time buyers and new builds) lowers the qualifying payment.
• At renewal you can switch lenders without re-qualifying, as long as the amount and amortization stay the same.
• Try your own numbers in the stress test calculator.

Frequently asked questions