Overcoming The Challenges Of Getting A Mortgage When You Are Self-Employed

There will always come a time in your life when you may need to acquire a mortgage for the property of your dreams. Applying for one has some qualification procedures that you must follow. It will be easy to secure documents that you need in order to qualify for that much-needed mortgage if you are employed by a company who can help certify your capacity to pay the mortgage amount. The question is what will happen if you are self-employed?

Self-employed Canadians and the mortgage scenario

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It has to be noted that almost 23% of income earners in Canada are self-employed or have at least made a living from part-time jobs. These statistics is an indication that more and more Canadians are attracted to being hired on a contractual basis or becoming self-employed to survive everyday living. The sad thing about this is it will be not as easy as it is for them to get approved for a mortgage loan from private lenders as it will be if they are employed by private companies or other companies for that matter.

The benefits and drawbacks of being self-employed

Being self-employed allows you to say you can work and survive on your own. Add to that, you can also pay slightly lower taxes because you can include your personal expenses among your deductibles before arriving at your taxable income figures. Take note though that there is a drawback that comes with the choice of being self-employed, one of which is it will not be easy for you to prove your income. Since you have a smaller income reflected on your tax return, it follows that you will have a hard time qualifying for mortgage and even if you do, you will only be granted a minimum mortgage amount.

Overcoming these challenges

It is good to note that mortgages are now available for you even when you are self-employed and just like you, there are other self-employed individuals who want to avail of such a privilege. Mortgage agents and brokers have made it possible for you to enjoy your hard-earned money and own the property you have dreamed of.

These agents work with you and give you access to lenders to get the amount of mortgage you need. They negotiate on your behalf in order to make the terms more flexible and agreeable for you. You can use these mortgages to buy a new home or other properties that you have in mind. All you have to do is basically show proof of income using documents such as income tax returns or a six-month bank statement. Business licenses, contracts, invoices, and articles of incorporation may also be required if you own a business.

New mortgage rules

One of the things you should bear in mind when looking for mortgage lenders in Montreal is to make sure that you are updated with the existing mortgage rules especially that new rules have been made effective on January 2018. You have to take note of what is in store for you with these new rules. Never hesitate to ask questions or make a research before signing the mortgage contract.

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