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Use the to estimate the maximum mortgage you can afford. This calculation is based on two simple rules that lenders use to determine how much of a mortgage you can afford.

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The shortest answer to that question is: it depends. The most important factors are (i) your gross household income, (ii) your down payment, and (iii) the mortgage interest rate. Lenders will also consider your assets and liabilities. Your lifestyle and debt comfort zone may also come into play.

The first affordability rule is that your monthly housing costs should not exceed 32% of your gross monthly household income. Housing costs include monthly mortgage principal and interest, taxes and heating expenses. If applicable, this sum also includes half of monthly condominium fees and the entire annual site lease (in the case of leasehold tenure).

The second affordability rule is that your entire monthly debt load shouldn't be more than 40% of your gross monthly income. This includes housing costs and other debts, such as car loans and credit card payments. Lenders add up these debts to determine what percentage they are of your gross household monthly income. This figure is your Total Debt Service (TDS) ratio.