Self Employed and Entrepreneurs

Qualifying for a mortgage when you own your own business can be a trying process.  We understand the hurdles that you’re faced with when you own your own business.  Typically the income you earn doesn’t reflect on the income that you submit into Revenue Canada; I’m SURE there must be some write-offs in your business…

The beauty of the programs that we have access to, understand that you may not always be able to verify a “reasonable” income.  Let’s face it; the less income that we have to verify, the less taxes we owe, right?  As a business owner, that only makes sense.  That’s why lenders and insurers have come up with a program that allows you to “state” your income to qualify for a mortgage!  Here’s the rundown of what you can expect…

Documentation/information requirements:

Sole Proprietorship
A one-owner operation where the owner directs all the activities of the business, assumes all authorities and obligations, and is liable for its business debts. The sole proprietor income is reported to revenue Canada on the standard tax return (T1 General) together with Revenue Canada's required statement of business or professional activities.

Documentation requirements - Any one of the following must confirm at least two (2) years business-for-self tenure:
Business License
GST/HST Return Summary
T1 Generals with statement of business activities attached for a minimum 2 years prepared by an arm's length third-party
Audited Financial Statements for the last 2 years, prepared and signed by a CA
Plus a recent Notice of Assessment or a signed affidavit by the borrower(s) to confirm no income tax arrears (Note: in the province of Quebec, both federal and provincial NOA's will be required)

Partnerships
Partnerships are businesses owned by two or more individuals who share the profits or losses of the business operation. The partnership income is reported to Revenue Canada on the standard tax report (T1 General) together with Revenue Canada's required statement of business or professional activities, which reflects the percentage of the NET income or loss for each partner of the enterprise.

Documentation requirements - Any one of the following must confirm at least two (2) years business-for-self tenure:
Business License
GST/HST Return Summary
T1 Generals with statement of business activities attached for a minimum 2 years prepared by an arm's length third-party
Audited Financial Statements for the last 2 years, prepared and signed by a CA
Plus a recent Notice of Assessment or a signed affidavit by the borrower(s) to confirm no income tax arrears (Note: in the province of Quebec, both federal and provincial NOA's will be required)

Corporations
A limited company or corporation is a legal entity, separate from the persons (all shareholders) who own it. The business can own assets, enter into contracts and conduct business transactions in its own capacity. The company is called limited because the liability of the shareholders is limited to their investment. All provincial Corporations must obtain articles of incorporation from the province in which they are registered or may be federally incorporated. The applicant's personal income will be reported by T4 from the corporation.

Documentation requirements - Any one of the following must confirm at least two (2) years business-for-self tenure:
Articles of incorporation
Audited Financial Statements for the last 2 years, prepared and signed by a CA
Plus a recent Notice of Assessment or a signed affidavit by the borrower(s) to confirm no income tax arrears (Note: in the province of Quebec, both federal and provincial NOA's will be required)

The key to this program is accurately depicting your “stated” part of your income.  Meaning, the lenders and insurers are looking to see that the stated income portion (that is submitted to a lender) is reasonable based on the industry, length of operation, and type of business.

Contact us today to find you the mortgage that fits for you!