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PITH stands for Principal, Interest, Taxes, and Heat — the four monthly housing costs Canadian lenders add together, plus 50% of any condo fees, to calculate the Gross Debt Service ratio.
“P” and “I” are the mortgage principal and interest payment itself, calculated at the minimum qualifying rate rather than the contract rate. “T” is property taxes, usually estimated from the municipal assessment or a lender’s standard formula. “H” is heat, which lenders include even when it is not separately metered, using a flat estimate.
For a condo, lenders also add 50% of the monthly condo (strata/co-ownership) fee to PITH, on the reasoning that a portion of those fees typically covers costs — like building insurance or a share of utilities — that a detached homeowner would otherwise pay directly. PITH is the numerator in the GDS ratio, and it is also the starting point for TDS, which adds every other debt payment on top.
PITH = Principal + Interest + Taxes + Heat, plus 50% of condo fees where applicable
Drives the GDS ratio: PITH is the numerator lenders divide by gross income to get GDS, capped at 39% for insured mortgages.
Calculated at the stress-test rate: the principal and interest portion of PITH uses the minimum qualifying rate, not the rate the borrower will actually pay.
Condo fees only count at 50%: lenders add half of the monthly condo fee to PITH rather than the full amount.
Used the same way nationally: PITH is a standard input for mortgage agents (Ontario), submortgage brokers (BC), mortgage associates (Alberta), and courtiers hypothécaires (Quebec), regardless of province.
Definitions reflect Canadian federal and provincial rules as of the “Updated” date above. Not advice for any specific file.
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