Rate Hold
Mortgage Rate Hold
Canadian mortgage term definition with formula, examples, and limits used by mortgage brokers.
Definition
A lender's commitment to honour a quoted rate for a set period (typically 90-120 days) while the borrower arranges financing. Protects against rate increases during purchase negotiations.
Standard Limit
Typical hold: 90-120 days from rate sheet date
Example
Broker submits deal on May 1 with 120-day rate hold. Buyer closes August 29 — within the rate hold window.
Related Terms
GDSMonthly housing costs divided by gross monthly income. Includes mortgage payment, property tax, heating, and 50% of condo fees.TDSAll monthly debt payments divided by gross monthly income. Includes housing costs plus credit cards, car loans, lines of credit, and other debts.LTVTotal mortgage debt divided by property value. Determines if CMHC insurance is required and which lenders qualify.CMHC InsuranceMandatory mortgage default insurance required when down payment is less than 20% (LTV > 80%). Enables up to 95% LTV financing.Stress TestBorrowers must qualify at a higher interest rate to ensure affordability if rates rise. Calculated as the maximum of contract rate + 2% or 5.25%.
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