Here's an interesting take on the mortgage "stress test" which was implemented by the federal Government at the end of last year on all insured mortgages (i.e mortgages with less than a 20% down payment).
I see the stress test as the a hedge against possible rate increases in the future, not that I see rates increasing but it is a measure put in place to protect against the possibility of rate increases. My opinion on the effectiveness of the "stress test" is up for another discussion all together!
The advice I like from this article is, taking the difference between what you can afford and what you can qualify for and using that cash as a method to pre-pay your mortgage and build equity faster. If you've ever seen a mortgage amortization schedule, (a what!?.. exactly), a mortgage amortization schedule is a payment schedule showing interest & principle payments amounts, from start to finish, until the total mortgage loan is paid off (google it if you're curious).
Here's the deal thought, in the beginning of your mortgage (the first 5 years especially) a higher portion of your payment goes toward interest and the lesser portion goes toward paying off your principle amount (the amount you've actually borrowed). The principle and interest ratio swings more and more to the principle payment side as the years of your mortgage go by.
Key take away: Instead of waiting for this natural process of the interest/principal ratio swing to take place. You can speed up building equity and paying off your mortgage faster by making lump sum or increased payments (which you'll want to apply 100% to the principal portion of the loan). By matching the payments you could afford onto the mortgage you qualify for under the new rules you will shave years off your mortgage and likely tens of thousands of dollars off of your interest payments. Show me someone who doesn't like to save tens of thousands! If you want to chat about this or have questions feel free to post here or PM me!