Purchasing a home involves one-time costs and monthly expenses. The largest one-time cost is the down payment. It usually represents between 5 – 25% of the total price of the property. In addition to the actual purchase price, there are a number of other expenses that you might be expected to pay for. These are listed in the following table:
Mortgage Application and Appraisal Fee
Property Inspection (optional)
Property Survey (sometimes provided by seller)
Land Transfer, Deed Tax or Property Purchase Tax
Mortgage Interest Adjustment and Take Over Fee
Adjustments for Fuel, Taxes, etc.
Mortgage Insurance (and Application Fee if applicable)
Home and Property Insurance
At time of application
Closing and ongoing
Date of move
Take your total monthly gross (before tax) income
Multiply it by the maximum GDS Radio (30%). x .30
This is the maximum amount available for your mortgage payment (principal and interest), property taxes and 50% of condo fees(if applicable)
Take your monthly gross (before tax) income
Multiply it by the maximum TDS ratio (40%) x .40
Subtract your regular monthly expenses (e.g. credit cards, car
payments, personal loans)
This is the maximum amount available for your mortgage payment,
property taxes and 50% of condo fees (if applicable)
To calculate this amount: Identify the lower of your GDS or TDS:
Subtract an appropriate amount for property tax:
This is the amount we will now use to calculate how much mortgage
you are eligible for.
Eligible Amount of Mortgage
Down Payment Available
House Price You Can Afford
Don’t forget that the down payment must be at least 10% of the purchase price of the home, unless you qualify for Canadian Mortgage and Housing Corporation’s (CMHC) 5% down program for first-time buyers.
Please note that all amounts are approximate. Columns A & B are based on an interest rate of 6.75%. Rates do vary. If rates are higher, you would be eligible for a smaller mortgage. If rates are lower, your mortgage could be higher.
These calculations do not take into account mortgage insurance premiums for high-ratio mortgages.