Mortgage education
GDS & TDS Ratios: How Lenders Measure Affordability
When you apply for a mortgage in Canada, your lender will almost certainly calculate two key numbers: GDS and TDS. These ratios tell them how much of your income is going toward housing and other debts.
GDS (Gross Debt Service) measures only housing costs. It is calculated as:
GDS = (mortgage payment + property taxes + heating + 50% of condo fees) ÷ gross monthly income
Lenders typically want GDS to stay below the high-30s. Many insured mortgages use a guideline around 39%. The lower your GDS, the more room you have in your budget for other expenses or rate increases.
TDS (Total Debt Service) goes one step further by adding your other monthly debts: credit cards, car loans, lines of credit, and similar items.
TDS = (housing costs + other monthly debt payments) ÷ gross monthly income
Insured mortgages often use a TDS guideline around 44%. If your TDS is much higher than that, your approval chances drop and you may be asked to reduce debt or increase your down payment.
Our mortgage calculator uses these ratios, along with your down payment and loan-to-value, to estimate an approval probability using a statistical model instead of simple yes/no rules. Try adjusting income, debts, and home price to see how your GDS and TDS change and how that affects your estimated approval chances.
Try the Mortgage Affordability & Approval Calculator
Use our calculator to estimate your monthly payment, check your GDS/TDS ratios, and see an estimated approval probability based on your income, down payment, and other debts.
You can adjust income, down payment, debts, and more to see how your approval chances move.