Debt-to-Income Ratio Calculator Canada (DTI/TDS) – Check Your Ratio 2026

A debt-to-income ratio (DTI) calculator measures the percentage of your gross monthly income consumed by debt payments, helping you assess mortgage eligibility and overall financial health. Canadian lenders use Gross Debt Service (GDS) and Total Debt Service (TDS) ratios to determine if you can afford a mortgage. CMHC sets maximum limits at 39% GDS for housing costs only and 44% TDS for all debt payments combined. If your TDS exceeds 43-44%, most prime lenders will decline mortgage applications. DTI over 50% signals severe debt burden requiring relief options like consumer proposals that eliminate 60-80% of unsecured debt.

How to Use This Calculator

Enter your gross monthly income (before taxes and deductions). List all monthly debt payments: mortgage or rent, property tax, heating/utilities, car loan payments, credit card minimum payments, personal loan payments, student loan payments, and any other debt obligations. The calculator computes both your GDS ratio (housing costs only) and TDS ratio (all debt payments).

Results show whether you meet CMHC qualifying thresholds (39% GDS / 44% TDS), fall within acceptable ranges for most lenders, or exceed limits that typically trigger mortgage declines. You’ll see your actual percentages compared to lender benchmarks and recommendations for next steps based on your ratios.

The calculator uses the same GDS/TDS methodology Canadian banks apply during mortgage qualification, including the stress test requirement that you qualify at contract rate plus 2% or the minimum qualifying rate of 5.25%.

Who This Is For

Use this calculator if you’re planning to apply for a mortgage or refinance and want to verify you meet lender GDS/TDS requirements before formally applying. It helps identify whether debt consolidation or debt relief is needed to improve your ratios before approaching lenders.

This calculator is essential if you’re facing mortgage renewal in 2026 and concerned about affording higher payments at current renewal rates (4.5-5.5%). Calculate whether payment shock will push your TDS above the 44% lender limit, signaling you need to reduce other debts before renewal.

You should also use this calculator if creditors are pressuring you or you’re considering debt relief options. Your DTI/TDS ratio determines whether you can manage payments or need a consumer proposal to eliminate 60-80% of unsecured debt and bring ratios back to manageable levels.

Understanding DTI, GDS, and TDS Ratios

GDS (Gross Debt Service) measures the percentage of your gross income dedicated solely to housing costs: mortgage principal and interest, property taxes, heating expenses, and condo fees if applicable. CMHC allows a maximum GDS of 39%, though the general banking guideline is 32%. The formula is: GDS = (Mortgage Payment + Property Tax + Heating + Condo Fees) ÷ Gross Monthly Income × 100.

TDS (Total Debt Service) measures the percentage of gross income dedicated to all debt payments: all housing costs from GDS plus credit cards, car loans, personal loans, lines of credit, student loans, and other debt obligations. CMHC maximum is 44% TDS for insured mortgages. The formula is: TDS = (All Housing Costs + All Other Debt Payments) ÷ Gross Monthly Income × 100.

DTI (debt-to-income ratio) is the general term for the percentage of income consumed by debt payments. In Canada, lenders focus specifically on GDS and TDS ratios. This calculator uses TDS methodology to show your complete debt picture including all payment obligations.

Canadian DTI/TDS Thresholds and Lender Limits

Most Canadian prime lenders cap TDS at 44% under CMHC mortgage insurance rules. Exceeding this threshold typically results in automatic mortgage application declines unless you have exceptional compensating factors like large down payments, perfect credit, or stable employment with high income.

Alternative lenders (B-lenders and private mortgages) may approve TDS ratios of 50-55% but charge significantly higher interest rates (7-12% versus 4.5-5.5% prime rates), costing thousands more annually in interest.

CMHC requires all federally regulated lenders to stress test borrowers at the higher of contract rate plus 2% or 5.25% minimum qualifying rate. Canada’s banking regulator OSFI now limits mortgages to borrowers where total mortgage debt exceeds 4.5 times annual income, though lenders can make exceptions in expensive markets like Toronto and Vancouver.

When DTI Over 43% Signals Need for Debt Relief

If your TDS is 44-50%, you’re over CMHC limits and most prime lenders will decline your mortgage application. Focus on debt reduction strategies before applying: pay off small debts under $5,000 to reduce monthly obligations, consolidate high-interest debts into lower-rate loans with reduced payments if your credit score exceeds 650, or file a consumer proposal if you owe $10,000-$250,000 unsecured debt with no realistic path to pay off within two years.

TDS over 50% means debt payments consume half your gross income, leaving insufficient funds for basic living expenses like food, transportation, clothing, and childcare. This signals insolvency requiring legal debt relief. Consumer proposals are the most effective solution: they stop all collection activity immediately through legal stay of proceedings, reduce unsecured debt by 60-80% with fixed monthly payments, keep all assets including homes and vehicles, and report as R7 credit rating removed three years after completion.

If you’re renewing your mortgage in 2026 and facing payment increases of $500-$1,000 monthly due to higher interest rates (2.5% original rate renewing at 5.5%), calculate whether the increased payment pushes your TDS over 44%. Filing a consumer proposal 60-90 days before mortgage renewal eliminates other unsecured debts, freeing cash flow to afford higher mortgage payments. Reducing $800/month in credit card and loan payments through a proposal with $400/month replacement payment creates $400/month net savings to absorb mortgage shock.

What to Do If Your DTI Is Too High

If your TDS is 40-44%, reduce monthly debt obligations before applying for a mortgage. Target credit cards and personal loans with highest minimum payments for payoff or consolidation. Even reducing TDS by 2-3 percentage points significantly improves approval odds and may qualify you for better interest rates. Consider waiting 6-12 months while aggressively paying down debt rather than applying now with weak ratios.

If your TDS is 44-50%, pursue formal debt relief before mortgage applications. Debt consolidation loans can reduce monthly payments 20-40% by lowering interest rates from 19-29% credit cards to 8-12% consolidation loans if your credit score exceeds 650. If consolidation isn’t viable due to poor credit or high debt over $25,000, consult a Licensed Insolvency Trustee about consumer proposals that reduce total debt and monthly payments while providing legal protection from creditors during the 3-5 year repayment period.

If your TDS exceeds 50%, you’re insolvent and debt payments exceed your ability to maintain basic living standards. File a consumer proposal to eliminate 60-80% of unsecured debt with affordable fixed monthly payments. Proposals stop wage garnishment, freeze interest and penalties, and prevent lawsuits. Free consultations with Licensed Insolvency Trustees provide exact calculations of your proposal payment, total debt reduction, and timeline to completion. Most proposals are accepted by creditors (97-99% acceptance rate) and complete in 3-5 years.

Calculate your debt payoff timeline to determine if DIY strategies can bring your DTI under 44% within 6-12 months, or explore bankruptcy as an alternative if debt exceeds $250,000 or you have no income for proposal payments. If you’re already facing collection action, read about Canada’s debt relief crisis to understand your options.

Use the Debt-to-Income Ratio Calculator now to check if you meet Canadian lender GDS/TDS limits. Enter your gross income and monthly debt payments for instant results showing your housing ratio (GDS) and total debt ratio (TDS). If results show TDS over 44%, calculate a consumer proposal to reduce debt by 60-80% and bring ratios within acceptable ranges.