Ontario Mortgage Income Requirements in 2024

In 2024, Ontario's mortgage income requirements continue to be a crucial factor for prospective homebuyers. Lenders in Ontario typically use two main ratios to assess mortgage affordability:

Gross Debt Service (GDS) Ratio: This ratio calculates the percentage of your gross monthly income needed to cover housing costs, including mortgage payments, property taxes, heating, and, if applicable, 50% of condo fees. Generally, lenders look for a GDS ratio of no more than 32%.

Total Debt Service (TDS) Ratio: This ratio considers all of your monthly debt obligations, including housing costs, car payments, credit card debt, and other loans. Lenders typically look for a TDS ratio of no more than 42%.

To determine if you meet Ontario's mortgage income requirements, follow these steps:

Calculate Your Gross Income: This includes your salary, bonuses, commissions, and other sources of income before deductions.

Determine Your Monthly Housing Costs: Include your estimated mortgage payment, property taxes, heating costs, and 50% of condo fees (if applicable).

Calculate Your GDS Ratio: Divide your total monthly housing costs by your gross monthly income and multiply by 100 to get a percentage. Ensure it's below 32%.

Calculate Your Total Debt Service: Add up all your monthly debt payments and divide by your gross monthly income. Multiply by 100 to get a percentage. Ensure it's below 42%.

Keep in mind that these ratios are guidelines, and lenders may have their own criteria. It's advisable to consult with a mortgage broker or lender to understand your specific situation and mortgage options in Ontario.