So you finally did it and joined the ranks of the SELF-EMPLOYED! You left your stable, well paying job to lead a more “balanced” life where you can pave your own way and follow your passion. That’s what you keep saying to yourself anyway…as you work through a mountain of paperwork and bills. To top it off, your once comfy apartment is squeezing and pinching your growing family to the max and you really need the extra space for an office and your expanding business. You wonder if you’ll EVER be able to afford a mortgage or larger home given the climbing home prices and stiffening mortgage guidelines. Yes! There IS a way you can move into your dream home with a great mortgage too! So here is the lowdown on what you’re going to need to be Mortgage Ready to income qualify as a SELF-EMPLOYED worker.
- First of all, you MUST be able to provide your personal tax Notice of Assessment for the previous 2 years.
- As a Sole Proprietor, you will need a T1 General with supporting Statement of Business Activities.
- If your business is Incorporated, you will be asked to provide your last 2 years of corporate financial statements as well as the last 2 years of personal Notice of Assessments.
- You cannot have had a negative income tax year for the last 2 years or have any outstanding taxes owing. (If owing, they must be paid in full and proof supplied).
- Does your business story make sense and does your income make sense for your industry? Examples include how many employees do you have, where do you get your clientele from?
- Can you confirm your business activity with a Business Registration Number, GST/HST registration, professional website, 411 listing etc?
If you are running a business, it is likely that you already have these things and it is important to keep your documents. If not, well start getting them together. Just as you use a Realtor to help you find the right home, it is just as important to use a Mortgage Broker to deal with the money aspect of a huge life investment. They will help you get the best mortgage for your financial situation and goals. They will lead the way and advise you on how you can use your self- employment income to get you and your family into the home you need! So don’t delay, just get busy getting organized!