Definition
A mortgage simulation is an estimated calculation allowing you to evaluate: how much you can borrow based on your income and debts (borrowing capacity), what your monthly payment will be based on chosen rate and amortization, and what the total interest cost will be over the mortgage life.
A simulation is not a pre-authorization: it does not commit the lender and does not guarantee final approval. It relies on self-reported data, without formal verification of the credit file or income. It is a budget planning tool.
Online calculators (including the Courteo calculator) use standard Canadian mortgage market formulas: OSFI stress test (contract rate + 2%, floor 5.25%), GDS/TDS ratios, amortization period (max 25 years for insured loan, 30 years for conventional since 2024). The most useful simulation is one performed with an AMF broker who knows lenders' actual parameters.