Self-employed mortgage questions

Yes, many self-employed borrowers qualify. Lenders typically look at your two-year average personal income (Line 15000 of your T1), and some lenders offer stated-income, bank-statement or add-back programs. Approval depends on each lender's review of your credit, income documents, down payment and the property.

A stated income (or self-declared income) mortgage lets you state a reasonable income supported by your business history and bank activity, rather than relying only on taxable income. These programs are mostly offered by alternative (B) lenders and some major lenders, and they generally need a larger down payment, often around 20% or more.

Business write-offs lower your taxable net income. Banks usually qualify you on that net figure, so strong real-world cash flow can look small on paper. It's a documentation problem more than an affordability problem, and a broker can compare lenders that read self-employed income differently.

Many traditional lenders prefer a two-year track record. Some lenders will consider less if you have been in the same line of work for longer, for example a contractor who went independent in the same trade. Requirements vary by lender.

No. A mortgage broker or agent arranges financing through third-party lenders and does not lend money. Meshesha Robel is a licensed Mortgage Agent Level 2 with Mortgage Alliance who compares options across 50+ bank, credit union, alternative and private lenders.

Commonly requested items include your last two years of Notices of Assessment (NOA), full T1 General returns, business financial statements if incorporated, proof of business registration or articles of incorporation, and recent business and personal bank statements. Each lender sets its own list.

If you qualify on your two-year average income through a traditional lender, the minimum down payment rules are the same as for any borrower in Canada. Stated-income and alternative programs typically need more, commonly 20% or higher. Your exact requirement depends on the lender and program.

Some lenders add certain non-cash or discretionary business expenses, such as depreciation (capital cost allowance), back to your income when calculating what you qualify for. Which expenses are eligible, and by how much, varies by lender.

A bank statement program looks at deposits into your business or personal accounts over a period, often 6 to 24 months, to support your income instead of relying only on tax returns. These are mostly offered by alternative lenders and terms vary.

Credit matters for every borrower, but it carries extra weight when income documentation is non-traditional. Stronger credit generally opens up more lenders and better terms; weaker credit narrows the options, often toward alternative or private lenders.

Private lending is usually a short-term bridge, for example to close a purchase, consolidate debt, or buy time while you rebuild credit or file stronger tax returns. It typically costs more, so it should come with a clear exit plan back to a traditional or alternative lender.

Often, yes. Refinancing is reviewed using your current income documentation and home equity. Self-employed homeowners commonly refinance to consolidate business or personal debt, or to access equity, subject to lender approval and loan-to-value limits.

It's worth reviewing. Staying with your current lender usually avoids requalifying, while switching may require full income documentation. A broker can compare whether a switch is realistic for your file before you sign a renewal offer.

Sometimes. If you're close to qualifying with a traditional lender, filing a year with higher declared income may get you better terms than an alternative product today. Speak with your accountant about tax implications. A broker can help you compare both paths.

An initial conversation to review your situation is free. In many standard cases the lender compensates the brokerage. For some alternative or private mortgages, broker or lender fees may apply, and any fees are disclosed in writing before you commit.