What is TDSR?
The Total Debt Servicing Ratio (TDSR) is a cap on the total amount that you can spend on your monthly mortgage debt repayments. With TDSR, your monthly loan repayment and other outstanding debts, cannot exceed 55% of your monthly income.
The TDSR was tightened from 60% to 55% on 16 December 2021 as part of cooling measures. This applies to loans for property purchases where the OTP (option to purchase) is granted on or after 16 December 2021. It also includes mortgage equity withdrawal loan applications made on or after 16 December 2021 (if you’re refinancing your loan). If you have existing property loans granted before 16 December 2021, it won’t be affected by the new TDSR limit.
Use our TDSR calculator to find out your TDSR limit before you purchase your property.
How to Calculate TDSR?
To calculate TDSR, take your monthly debt repayments, divide it by your gross monthly income and multiply it by 100%. This figure cannot exceed 55%.
Monthly debt repayments include all outstanding debts like property-related loans (including the one you’re applying for), car loans, renovation loans, credit card loans etc.
If you have a variable and/or rental income, only 70% of your total assessed income will be counted towards TDSR. Variable income refers to commission, bonus, allowance etc. FIs will take the average of the monthly variable income that you’ve earned in the preceding 12 months.
Look at the infographic below to see an example of TDSR calculation:
