Use our free Gross Debt Service Ratio (GDS) Calculator to quickly determine if your potential housing costs, including mortgage payments, property taxes, and heating, fit within typical lender guidelines. Understanding your GDS ratio is crucial for mortgage pre-approval and knowing your home-buying budget.
Formula:
The Gross Debt Service (GDS) Ratio is calculated as follows:
GDS Ratio (%) = [ (Monthly Principal & Interest + Monthly Property Taxes + Monthly Heating Costs + 50% of Monthly Condo Fees) × 12 ] / Gross Annual Income × 100
Where:
- Monthly Principal & Interest: Your anticipated monthly mortgage payment.
- Monthly Property Taxes: Your monthly property tax obligation.
- Monthly Heating Costs: Estimated monthly heating expenses.
- Monthly Condo Fees: Applicable monthly condominium fees (if any).
- Gross Annual Income: Your total income before deductions.