At AKAL Mortgages we probably know more than anyone when it comes to self employed mortgages. They are becoming frequent request in the mortgage world.
A self-employed mortgage, is an increasingly popular term that is being heard and used by us, as well as, many mortgage brokers across the globe because more and more people choose to be self-employed.
They are, however, not easy to acquire for many self-employed individuals. Since there are so many rules and regulations to be approved for a mortgage when you are self-employed there are simply just too many to list them all here. About 365 pages would be necessary, especially if the fine print were to be included.
That being said, the basics will have to do. In reality, any interested individual just wants to know what the basic requirements are if they want to be a mortgage holder who is earning a living by way of self-employment.
For those inquiring minds, here is the information you’ve been looking for. Let’s start with just the basics that you need to even be considered for a mortgage if you are self-employed:
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Applications without at least the past 2-3 years of Notice of Assessments from CCRA will not be considered as opposed to the applications that are complete with the assessments having more consideration for approval
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Those who cannot provide proof of income with the government and show consistent income, must also provide a minimum of 10% down payment of the asking price, as well as have proof of good credit history, provide proof of your business and personal credit ratings
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Proof must be shown that the down payment is NOT a gift from an outside party
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Provide proof of all financial business statements and that you are the legitimate primary business owner
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Provide proof that all of your GST and or HST is all paid in full
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Contracts showing any expected revenue for coming years
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Provide a copy of your business license or GST license
As you can see, acquiring a mortgage if you are a self-employed individual is clearly a very difficult task.
There is tons of documented proof that must be provided, along with a decent credit history. Most people may think that banks are the way to go, but with all of the changes in Canada with mortgage rules, banks are buckling down and most often say no.
If you don’t meet the minimum requirements above, then speak to a mortgage broker to see what you can do to meet them or what other options are available to you.
When we say Yes! We stand behind our promise.