The stress test was implemented by the Canadian Government in 2018 with the purpose of ensuring that Canadians will continue to afford their homes should interest rates be significantly higher, on renewal. All homebuyers must pass the stress test, regardless of their down payment.
You must pass the stress test in order to qualify for the mortgage you want.
In order to pass the stress test, a qualifying interest rate that is much higher than the rate you will actually pay, must be used in your mortgage application. The rate is set by the government and it changes over time. If you qualify for the mortgage using the stress test rate then we can move forward. If you do not, then we have to reduce the mortgage amount until we find one that passes the test.
You can see how your numbers look by clicking HERE (remember you have to enter the stress test rate as your interest rate).