Affordable Mortgage Calculator Ontario

Determine your maximum affordable mortgage in Ontario based on your income, expenses, and down payment. This calculator uses the official mortgage stress test guidelines to help you find a mortgage that fits your financial situation.

How to Use This Calculator

To calculate your affordable mortgage in Ontario:

Enter your gross monthly income before taxes.
Enter your total monthly debt payments (excluding mortgage payments).
Select your amortization period (typically 25 or 30 years).
Enter your down payment amount or percentage.
Click Calculate to see your maximum mortgage amount.

The calculator uses the official mortgage stress test guidelines from the Ontario government to determine your maximum affordable mortgage.

Formula Used

The maximum mortgage amount is calculated using the following formula:

Maximum Mortgage = (Income - Expenses) × 2.5 × (Amortization Period / 5)

Where:

Income = Your gross monthly income
Expenses = Your total monthly debt payments (excluding mortgage)
Amortization Period = The term of your mortgage in years

This formula is based on the official mortgage stress test guidelines from the Ontario government, which recommends that your total debt payments (including mortgage) should not exceed 40% of your gross monthly income.

Worked Example

Let's calculate the maximum mortgage for someone with:

Gross monthly income: $5,000
Total monthly debt payments: $1,200
Amortization period: 25 years
Down payment: 5% of the mortgage amount

Using the formula:

Maximum Mortgage = ($5,000 - $1,200) × 2.5 × (25 / 5)

= $3,800 × 2.5 × 5

= $3,800 × 12.5

= $47,500

With a 5% down payment, the total mortgage amount would be $47,500, with $2,375 as the down payment.

Frequently Asked Questions

What is the mortgage stress test in Ontario?: The mortgage stress test is a requirement for mortgage approval in Ontario. It ensures that your mortgage payments are affordable based on your income and existing debt obligations.
How does the amortization period affect my mortgage?: A longer amortization period (like 30 years) will result in a higher maximum mortgage amount compared to a shorter period (like 25 years) because you'll be paying less each month.
Can I use this calculator for a co-signer?: Yes, you can include the co-signer's income and expenses in the calculator to determine the maximum mortgage amount that fits both of your financial situations.
What if my income changes in the future?: The calculator provides an estimate based on your current financial information. If your income changes significantly, you should consult with a mortgage professional to reassess your mortgage options.