Regulatory reference rate used in parts of Canadian mortgage qualification and stress-test policy.
The benchmark qualifying rate is the minimum rate or floor used in mortgage underwriting to test whether a borrower can still qualify at a higher rate than the one in the contract.
Borrowers often see an attractive contract rate and assume that is the only rate that matters for approval. The benchmark qualifying rate helps explain why the approved amount may be smaller than expected.
As of January 29, 2026, OSFI says the prescribed minimum qualifying rate for uninsured mortgages at federally regulated lenders is 5.25%, and the borrower must generally qualify at the greater of that floor or the contract rate plus 2 percentage points.
OSFI also says uninsured straight switches at renewal are exempt from the prescribed MQR. That distinction matters because a borrower may struggle to qualify for a new purchase or refinance amount but still be able to switch an existing uninsured mortgage at renewal.
$$ \text{QR}=\max(r+2,\ 5.25)% $$
Here, r is the mortgage contract rate, and all values in the formula are percentage figures.
| Contract rate | Contract rate + 2% | Floor | Qualifying rate used |
|---|---|---|---|
| 2.90% | 4.90% | 5.25% | 5.25% |
| 3.25% | 5.25% | 5.25% | 5.25% |
| 4.60% | 6.60% | 5.25% | 6.60% |
| 5.10% | 7.10% | 5.25% | 7.10% |
If a borrower signs at 4.60%, the benchmark alone would be 5.25%, but contract plus 2% would be 6.60%. The lender would normally use the higher figure for the affordability test on an uninsured mortgage.
The benchmark qualifying rate is not the same as the borrower’s actual contract rate.
Borrowers also sometimes think the benchmark is a pricing tool used to punish them. It is an underwriting safeguard meant to test resilience to rate shocks.
Benchmark rules can change, and the exact treatment depends on lender type and mortgage type. Insured, uninsured, switch, and refinance files do not always receive identical treatment, so borrowers should confirm which rule applies to their file date and lender category.