SELF-EMPLOYED MORTGAGE
SELF-EMPLOYED AND SEEKING A MORTGAGE?
Did you know that approximately 15% of the Canadian workforce is self-employed? The benefits of self-employment include vacation flexibility, the ability to run your schedule as you want and the opportunity to earn higher gross and net revenues. Sounds awesome, right? One of the downsides to entrepreneurship comes into play when you’re trying to obtain financing – for real estate, vehicles, revolving credit and more. Don’t fret if you’re in the market for a mortgage, while self-employed – our team of top Toronto mortgage brokers will make your application process a smooth and informed one.
What is a Self Employed Mortgage?
The main difference between salaried employees and entrepreneurs is that self-employed individuals typically earn an inconsistent income while employed individuals get set paychecks consistently at weekly, bi-weekly or monthly intervals. During a standard mortgage application process to obtain a traditional real estate mortgage, a lender considers your net income based off of the average of your last 2 annual tax returns. Many self-employed individuals tend to have a lower annual income as a result of claiming business expenses and tax write-offs, making it harder to qualify for a larger financing amount.
Though proof of income may prove difficult in your mortgage application, it does not mean that approval is impossible.
So, can I get a mortgage being self-employed?
Working with our team of trusted mortgage brokers – yes, you can. We don’t believe that owning a business should impede your opportunity to buy a home or invest in real estate as a strategy to grow your wealth. Our mortgage products for self-employed workers are designed with you, the entrepreneur in mind, so you can finance or refinance your real estate purchases with ease.
Self-Employed Income Confirmation
Our team of mortgage advisors are here to help you put together the most desirable application to be presented to a variety of top lenders. You may have strong Notice of Assessments, showing consistent self-employed income over the last few years and if so, this could help you breeze through the application process with our mortgage professionals as if it were a traditional submission. It’s best to prepare yourself for application success by gathering these documents (and any others that you think could strengthen your application.)
In addition to providing 2-3 years of filed Notices of Assessments, some of the other supporting documentation a lender may require for a self-employed mortgage application include:
- Proof that you are a principal owner in the business.
- A copy of your Article of Incorporation.
- T1 General Statements for the last 2 Tax Return Years. A lender may also ask for Audited Financial Statements prepared by a professional accountant. This helps to report your business and professional income and expenses and the form can help to calculate your gross income and net income.
- Proof that your HST/GST and personal tax balances owing are paid in full.
- Contracts showing expected revenue for the coming years.
- Your personal and business credit scores.
- Proof that your down payment has not been gifted – it’s best to save a minimum of 10% down to strengthen your application.
Why Use a Self-Employed Mortgage Broker?
It’s no secret that it’ll be difficult for you to identify which lenders specialize in self-employed mortgages, or have more favourable terms for the self-employed, and this is where using a certified mortgage broker has even greater advantages.
Just because you’re self-employed, doesn’t mean you have to sign on the dotted line for a mortgage with an alternative lender. We have the top lending connections in the Canadian mortgage industry which allows us to access the best mortgage rates on the market and pass the savings onto you. Our mortgage advisors will help you to secure a mortgage product that serves your financing needs both now and in the future.
Skip the tedious work of trying to apply on your own to a range of lenders and instead let our local mortgage agents shop the variety of lenders we already have strong connections (and the best mortgage rates) with. While it may not sound like a huge difference, a 0.5% decrease in your obtained mortgage rate can potentially save you thousands of dollars in interest over the course of your mortgage. Let us show you the best rates around.
There are many benefits to working with our awesome team of licensed Toronto mortgage brokers. Saving money, protecting the credit score you’ve worked hard to build and getting the best mortgage broker rates on the market are just a few reasons to connect with our team.
No two mortgage applications are the same – so why should the advice be?
Our certified mortgage advisors will take the time to review your unique self-employed situation to decide which application route is best for you. We’ll keep you in the loop every step of the way, with mortgage education, top financing resources and connections to any other top real estate professionals you may need during your homeownership journey. Get the advice you need and the results you deserve.