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Calculator · Stress Test

What does the Canadian stress test do to your payment?

Federally regulated lenders qualify you at the greater of your contract rate +2% or 5.25%. Here's the payment a lender will actually use to size your file.

Updates as you type| Built on Canadian mortgage rules| Ontario & Canada-wide| Built by FSRA-licensed brokers
Calculator reviewed by the Principal Broker, Mortgage Squad Advisors · FSRA #13737| Updated June 2026
The short answer

The mortgage stress test qualifies you at the greater of your contract rate +2% or 5.25% — so a 4.39% offer is tested at 6.39%. That higher qualifying payment, not your real one, sets your maximum mortgage. Enter your rate, income and debts above to see the payment a lender will actually use — and note several credit unions qualify on your contract rate instead.

Your inputs

$620k
4.14%
25 yrs
Qualifying rate
6.14%
vs. 4.14% contract rate
The math
Payment at contract rate$3,309
Payment at qualifying rate$4,019
Monthly difference$710

What the stress test costs your borrowing power

The $3,309/mo your contract rate produces carries a far smaller mortgage once a lender re-prices it at the 6.14% qualifying rate.

At your contract rate · 4.14%$620,000
Stress-test qualifying · 6.14%$510,459
Borrowing-power gap
$109,541less mortgage — about 18% — for the very same monthly payment.
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Deeper analysis

Why the stress test exists — and why the gap appears

The Canadian mortgage stress test comes from OSFI Guideline B-20, the rulebook every federally regulated lender follows. It forces lenders to qualify you at the greater of your contract rate +2% or 5.25%, even though your actual payments are based on the lower contract rate. The point is resilience: if rates climb at renewal, you should still be able to carry the loan.

The borrowing-power gap above appears because a higher qualifying rate means more of every hypothetical payment is treated as interest, so the same dollar budget supports a smaller principal. That is the mechanism that shrinks your maximum mortgage by roughly 18% on this file — not your real payment, which never changes.

You can sometimes close the gap: provincial credit unions are not bound by B-20 and may qualify at contract rate, and a larger down payment or lower other debt frees up room. See how it flows through to a full purchase budget on our affordability calculator, or the income behind it on our income-required calculator.

How this is calculated
The stress test applies to insured AND uninsured mortgages at federally regulated lenders. Some provincial credit unions and B-lenders qualify on contract rate; we shop both paths. The qualifying-rate rule is set by OSFI Guideline B-20.
Mortgage glossary— terms that matter for this calculator
Stress test Qualifying rate OSFI B-20 GDS TDS A vs. B lender
Common questions

Frequently asked

Don’t see yours? Ask Maya for a quick, accurate answer.

What is the Canadian mortgage stress test?
OSFI Guideline B-20 requires every federally regulated lender in Canada to qualify a borrower at the greater of contract rate + 2% or 5.25%. So a 4.39% offered rate qualifies at 6.39%. The qualifying rate doesn't change your payment — it determines how much mortgage you can carry.
Who is exempt from the stress test?
Provincial credit unions (Meridian, Vancity, FirstOntario, etc.) are not federally regulated. Many qualify at contract rate. And since November 21, 2024, a straight switch to a new lender at renewal (same balance, same amortization) skips the stress test at federally regulated lenders too. We route you to those lenders when your file is at the edge of affordability.
Does the stress test apply at renewal?
If you stay with your current lender at offered renewal: generally no re-qualification, even if your financial situation has worsened. If you switch lenders on a straight transfer (same balance, same amortization): no stress test since November 21, 2024, though the new lender still reviews your file. Add money or extend the amortization and you're qualified under B-20.
What's GDS and TDS?
GDS (Gross Debt Service ratio) = housing costs ÷ gross income, max 39%. TDS (Total Debt Service) = housing + all other debts ÷ gross income, max 44%. Both are computed using the qualifying rate, not the contract rate. The lower one between GDS and TDS becomes your binding constraint.
Can I improve my stress-tested affordability?
Three levers: (1) increase qualifying income via add-backs, dividend gross-ups, or rental offset; (2) reduce other monthly debt (pay down credit cards, refinance a car loan); (3) increase down payment to lower the mortgage size. The right play depends on your file. Run the numbers on our affordability calculator.
How much does the stress test reduce how much I can borrow?
For the same monthly payment, qualifying at the stress rate instead of your contract rate typically shrinks your maximum mortgage by 15-22% — the higher the rate gap, the bigger the cut. The borrowing-power comparison above shows your exact dollar gap. It doesn't change your real payment, only the principal a lender will let you carry.
Is the stress test rate the same as my mortgage rate?
No. Your contract rate sets your actual payment; the qualifying (stress-test) rate — contract +2% or 5.25%, whichever is higher — is used only to size how much you can borrow. See the payment your contract rate produces on our mortgage payment calculator.
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