Mortgages for the Self Employed

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Mortgages for the Self Employed: A Comprehensive Guide


What is a Self-Employed Mortgage?

A self-employed mortgage is a home loan specifically designed for individuals who are self-employed or run their own businesses. These mortgages cater to the unique financial circumstances of self-employed borrowers, considering their variable income and documentation requirements.

Eligibility Criteria for Self-Employed Mortgages

Income Verification

Lenders require proof of a stable and consistent income when approving mortgages for self-employed individuals. This may include providing:

  1. Business financial statements
  2. Notices of Assessment (NOAs) from the Canada Revenue Agency (CRA)
  3. Personal income tax returns

Credit Score

A good credit score is essential for securing a self-employed mortgage. Lenders typically require a credit score of at least 680.

Down Payment

A minimum down payment of 5% is required for homes costing less than $500,000. For properties between $500,000 and $1 million, a 10% down payment is necessary.

Tips for Securing a Self-Employed Mortgage

Strengthen Your Credit Score

Before applying, ensure your credit score is in excellent condition. Regularly monitor your credit report, make timely payments, and maintain low credit utilization.

Organize Financial Documentation

Keep your financial records up-to-date and organized. Lenders may request various documents, such as:

  1. Business licenses
  2. GST/HST returns
  3. Business and personal tax returns

Consult a Mortgage Broker

Mortgage brokers can help navigate the mortgage application process and find lenders with favorable terms and rates for self-employed borrowers.

Consider Alternative Lenders

If traditional lenders aren't a viable option, consider alternative lenders such as credit unions, trust companies, or private mortgage lenders.

Mortgage Options for Self-Employed Borrowers

Stated Income Mortgage

A stated income mortgage allows borrowers to declare their income without providing traditional income verification documents. Lenders consider the borrower's credit score, down payment, and debt-to-income ratio when evaluating their application.

Home Equity Line of Credit (HELOC)

A HELOC is a revolving line of credit secured by your home. Self-employed borrowers can use a HELOC for various purposes, such as consolidating debts or financing home improvements.

Business for Self (BFS) Program

The BFS Program is designed for self-employed borrowers with a strong credit history, stable income, and a minimum 10% down payment. This program offers competitive mortgage rates and terms.

Private Mortgages

Private mortgages are short-term loans provided by private lenders. These loans may have higher interest rates but can be a suitable option for self-employed borrowers who cannot secure a mortgage through traditional means.


Mortgages for the self-employed can be complex, but with the right guidance and preparation, securing a mortgage is achievable. Ensure you have a strong credit score, organized financial documentation, and consider consulting a mortgage broker to navigate the process. Alternative lending options, such as stated income mortgages, HELOCs, BFS programs, and private mortgages, can offer tailored solutions for self-employed borrowers.

If you want to explore your customized solution, schedule a 30-minute consultation with us NOW.

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