Just because the numbers say you can, doesn’t mean you can afford it!

Marci • April 13, 2012

While most of us have a basic knowledge of our monthly expenditures, others need to explore their finances to find out. To come to terms with your maximum mortgage payment, you need your monthly gross income and your monthly debt payments. Calculate 33% and 44% of your monthly gross income.

 

Your monthly mortgage payment, plus mortgage insurance, property tax and strata fees (if applicable) must be less than the 32%. Now, take those monthly payments and add all other monthly debt (payments to loans, credit cards, leases, etc.). This amount must be less than the 44%.

 

Going to the max

In the current environment of low interest rates, you want to be cautious about going to your maximum mortgage amount because an increase in rates could be devastating.

 

For example, a couple with a combined income of $135,000 might qualify for a $700,000 mortgage at 3.5%. Their payments would be approximately $3,500 a month. If rates increase to 5%, that monthly payment increases to $4,075 – $6,900 more each year. The amount they would qualify for at that higher rate would reduce substantially to $585,000.

 

There are times when you fall in love with a house. If it sits at your maximum it means you can afford it, right? Yes, on paper, you can afford your maximum, but only in rare circumstances would I suggest it.

 

So, if love isn’t a good enough reason to go to your maximum, what is?

 

An almost certain increase in income and a significant down payment (35% or more).

 

Having a job where your salary is almost guaranteed to increase makes going to your maximum easier. As is when the maximum is calculated on one income but a second income will be introduced (ie – a spouse returning to work after mat leave), or the possibility for income from a rental suite.

 

These things don’t make the deal work, they simply ensure an increased income to make going to the maximum safer.

 

Getting a higher priced property is easier with two incomes, a larger down payment, familiarity with making mortgage payments, an expectation of future funds to apply to the mortgage (bonuses, inheritance), a more secure job, or the intention to stay in the house longer.

 

Lean towards a cheaper option when a rate increase would make your budget impossible, the budget required would be difficult to stick to, economic or income expectations are uncertain or you are planning on adding to your family.

 

Yes, getting a more expensive house is tempting and there are times when it will work and be worth it. Take stock of your personal finances to ensure it’s the right decision and won’t lead to a painful outcome.

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Bank of Canada Holds Rate at 2.25% — June 10, 2026

By Marci Deane • June 10, 2026
The Bank of Canada announced today that it is maintaining its target for the overnight rate at 2.25%, with the Bank Rate at 2.5% and the deposit rate at 2.20%. For Canadian homeowners, buyers, and anyone with a mortgage on the horizon — here's what you need to know.

First-Time Buyer? Here’s How to Tell If You’re Ready

By Marci Deane • June 3, 2026
Ready to Buy Your First Home? Here’s How to Know for Sure Buying your first home is exciting—but it’s also a major financial decision. So how can you tell if you’re truly ready to take that leap into homeownership? Whether you’re confident or still unsure, these four signs are solid indicators that you’re on the right path: 1. You’ve Got Your Down Payment and Closing Costs in Place To purchase a home in Canada, you’ll need at least 5% of the purchase price as a down payment. In addition, plan for around 1.5% to 2% of the home’s value to cover closing costs like legal fees, insurance, and adjustments. If you’ve managed to save this on your own, that’s a great sign of financial discipline. If you're receiving help from a family member through a gifted down payment , that works too—as long as the paperwork is in order. Either way, having these funds ready shows you’re prepared for the upfront costs of homeownership. 2. Your Credit Profile Tells a Good Story Lenders want to know how you manage debt. Before they approve you for a mortgage, they’ll review your credit history. What they typically like to see: At least two active credit accounts (trade lines) , like a credit card or loan Each with a minimum limit of $2,000 Open and active for at least 2 years Even if your credit isn’t perfect, don’t panic. There may still be options, such as using a co-signer or working on a credit improvement plan with a mortgage expert. 3. Your Income Can Support Homeownership—Comfortably A steady income is essential, but not all income is treated equally. If you’re full-time and past probation , you’re in a strong position. If you’re self-employed, on contract, or rely on variable income like tips or commissions, you’ll generally need a two-year history to qualify. A general rule: housing costs (mortgage, taxes, utilities) should stay under 35% of your gross monthly income . That leaves plenty of room for other living expenses, savings, and—yes—some fun too. 4. You’ve Talked to a Mortgage Professional Let’s be real—there’s a lot of info out there about buying a home. Google searches and TikToks can only take you so far. If you're serious about buying, speaking with a mortgage professional is the most effective next step. Why? Because you'll: Get pre-approved (and know what price range you're working with) Understand your loan options and the qualification process Build a game plan that suits your timeline and financial goals The Bottom Line: Being “ready” to buy a home isn’t just about how much you want it—it’s about being financially prepared, credit-ready, and backed by expert advice. If you’re thinking about homeownership, let’s chat. I’d love to help you understand your options, crunch the numbers, and build a plan that gets you confidently across the finish line—keys in hand.

Home Reno Dreams? Let’s Talk Mortgage Financing

By Marci Deane • May 27, 2026
How to Use Your Mortgage to Finance Home Renovations Home renovations can be exciting—but they can also be expensive. Whether you're upgrading your kitchen, finishing the basement, or tackling a much-needed repair, the cost of materials and labour adds up quickly. If you don’t have all the cash on hand, don’t worry. There are smart ways to use mortgage financing to fund your renovation plans without derailing your financial stability. Here are three mortgage-related strategies that can help: 1. Refinancing Your Mortgage If you're already a homeowner, one of the most straightforward ways to access funds for renovations is through a mortgage refinance. This involves breaking your current mortgage and replacing it with a new one that includes the amount you need for your renovations. Key benefits: You can access up to 80% of your home’s appraised value , assuming you qualify. It may be possible to lower your interest rate or reduce your monthly payments. Timing tip: If your mortgage is up for renewal soon, refinancing at that time can help you avoid prepayment penalties. Even mid-term refinancing could make financial sense, depending on your existing rate and your renovation goals. 2. Home Equity Line of Credit (HELOC) If you have significant equity in your home, a Home Equity Line of Credit (HELOC) can offer flexible funding for renovations. A HELOC is a revolving credit line secured against your home, typically at a lower interest rate than unsecured borrowing. Why consider a HELOC? You only pay interest on the amount you use. You can access funds as needed, which is ideal for staged or ongoing renovations. You maintain the terms of your existing mortgage if you don’t want to refinance. Unlike a traditional loan, a HELOC allows you to borrow, repay, and borrow again—similar to how a credit card works, but with much lower rates. 3. Purchase Plus Improvements Mortgage If you're in the market for a new home and find a property that needs some work, a "Purchase Plus Improvements" mortgage could be a great option. This allows you to include renovation costs in your initial mortgage. How it works: The renovation funds are advanced based on a quote and are held in trust until the work is complete. The renovations must add value to the property and meet lender requirements. This type of mortgage lets you start with a home that might be more affordable upfront and customize it to your taste—all while building equity from day one. Final Thoughts Your home is likely your biggest investment, and upgrading it wisely can enhance both your comfort and its value. Mortgage financing can be a powerful tool to fund renovations without tapping into high-interest debt. The right solution depends on your unique financial situation, goals, and timing. Let’s chat about your options, run the numbers, and create a plan that works for you. 📞 Ready to renovate? Connect anytime to get started!