The percentage of your gross income needed to cover housing costs.
GDS includes your mortgage payments (principal + interest), property taxes, heating costs, and 50% of condo fees if applicable. The maximum GDS ratio for most lenders is 39%. For example, if your gross annual income is $100,000, your total annual housing costs should not exceed $39,000 ($3,250 per month). Some lenders and insurers allow higher GDS ratios for borrowers with strong credit profiles.
Related terms: Total Debt Service (TDS) Ratio | Mortgage Stress Test | Qualifying Rate