If you are one of the approximately 2.5 million self-employed workers in Canada, or one of the millions more who generate your income through commission-based sales, you may have had a difficulty in the past arranging competitively-priced mortgage financing.

Banks have traditionally shied away from lensing money to the self-employed, as without a file full of predictable pay stubs to back you up; lenders may not feel confident that you can meet your mortgage obligations. However, with the rising amount of workers moving into independent employment arrangements, the time has come for lending institutions to look at this particular market in a more accepting manner.

As a general rule, you can prepare for your loan application by:
 - Working on a good credit record. Ensure your income tax has been filed, and you owe no money to Revenue Canada. Check that all payments on your credit cards or other loans are up-to-date.
 - You'll need to provide proof of how long you have been self-employed (three or more years is ideal), plus your incorporation number and GST number.
 - You'll find that it's often easier to secure financing for a property that's in or near a major city centre.

Many business-for-self owners deduct expenses in lieu of extra income, something that doesn't fit into the regular bank accounting structure. A smart financial strategy for your business is to minimize taxable income, but when your final numbers are plugged into a regular chartered bank's lending criteria, they may view you as a high-risk borrower.

Please call us for helpful tips on preparing your loan application; we can help you prepare for, and find, financing precisely designed for your independent work situation.