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Mortgage services / Self-employed

Self-employed mortgages

Your business income can be assessed in different ways. Speak with Puneet Mann, a Mortgage Agent Level 2 in Brampton.

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Is this you?

01You’re a sole proprietorYour personal tax return includes the income from your business.

02You own an incorporated businessYour company’s finances and how you pay yourself both matter.

03You claim business expensesEligible expenses may be treated differently when calculating mortgage income.

04Your income varies year to yearYour earnings history helps lenders assess what you can afford.

How lenders see

Lenders look at how much you earn, how consistently you earn it and the records that support your income. Tax returns and Notices of Assessment, often covering the past two years, are a common starting point.

The calculation varies by mortgage program. Some allow eligible business expenses to be added back to your income. Others use business bank statements or financial statements to help assess earnings. Your credit, existing debts and down payment or home equity also shape your options.

Which lender fits?

A lenders: Banks and credit unionsOften assess income using tax returns and Notices of Assessment. Some programs allow adjustments for eligible business expenses.
B lenders: Alternative lendersSome programs use business bank statements or financial statements to assess income. Down-payment requirements, fees and conditions vary.
C lenders: Private lendersGenerally provide short-term financing, with greater emphasis on the property’s equity. The total cost and a realistic repayment plan are central considerations.

A, B and C lending explained

The application process

Puneet’s Level 2 licence covers bank, alternative and private lending. These are the main stages of an application.

1Review your financesBring together your income, business records, debts and down payment or home equity. These details help establish what you can afford and which mortgage options may suit your situation and your plans.

2Compare mortgage optionsConsider the payments, fees, term and conditions of the options available. The mortgage should suit your finances, the property and your plans for it, both now and when the term comes up for renewal.

3Meet the lender’s conditionsProvide the supporting documents and review the mortgage agreement. Any conditions, such as an appraisal or updated income records, must be satisfied before the lender releases the funds.

Questions people ask

Can I get a mortgage in my first two years of self-employment?

Some mortgage programs consider applicants with less than two years in business. Relevant work experience, training, taking over an established business or evidence of ongoing earnings may support an application. The lender and any mortgage insurer involved each have requirements you must meet.

Do lenders use my income before or after expenses?

Income after business expenses is a common starting point. Some mortgage programs allow eligible expenses to be added back when calculating qualifying income. Others assess earnings using business bank statements and supporting records. The approach depends on your business structure and the program.

Does it matter if I am incorporated?

Yes. A lender may review your company’s finances alongside your personal income documents to understand how the business supports your earnings. Corporate tax returns, financial statements and proof of ownership may form part of the application.

How much do I need for a down payment?

The amount depends on the purchase price, the property’s use and the mortgage program. How your income is documented can also affect the requirements. When planning your budget, allow for closing costs as well as the down payment.

Does applying affect my credit score?

A mortgage application can involve a hard credit check, which can affect your score. Your consent is required before a mortgage agent obtains your credit report. Checking your own credit report does not affect your score.

What documents will I need?

The list depends on your business and the mortgage program. Common documents include:

Personal tax returns, called T1 Generals, and Notices of Assessment, often for the past two years.
Recent business bank statements.
A business licence or articles of incorporation.
Business financial statements and, if incorporated, T2 corporate tax returns.
Signed contracts that support your income.
For a purchase, proof of your down payment and the purchase agreement.

The lender may request additional documents for your circumstances.

Ask PuneetHave a question about your situation?Get in touch with Puneet to discuss your business income and what you’re planning.Get in touch