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Mortgages for the self-employed
Your tax return shows what you owe the CRA, not what you can afford. We show lenders the full picture of your income and find the ones that understand it.
- 5-yr fixed
- 4.69%
- 5-yr variable
- 3.70%
Updated Oct 8 · on approved credit · Compare to bank rates
Why it feels harder when you work for yourself
On salary, a lender reads your income off a pay stub. When you run a business, it reads your tax return, and a good accountant's job is to keep the taxable number low. The write-offs that save you tax can also shrink the income a lender sees, which is why owners of healthy businesses are sometimes surprised by how little they qualify for.
The answer is usually in how your file is put together and which lender sees it. The mortgage insurers and many lenders let certain expenses be added back to your income, and lenders differ in how they weigh business history and bank deposits. We work through your returns with you, and with your accountant if you like, before any application goes in.
What lenders look at
Two years of returns
Usually two years of T1 Generals with their Notices of Assessment, plus your Statement of Business Activities (T2125) or, if you are incorporated, the company's financial statements.
Add-backs
For insured mortgages, CMHC lets business-use-of-home, motor vehicle and capital cost allowance deductions be added back to your income, or a sole proprietor's or partner's business income be grossed up by 15% instead.
Time in business
CMHC recommends 24 months in business but can be flexible, for example if you worked in the same line of work before or bought an established business. Lenders also look at the trend across your last two years.
How it works
How we build a self-employed file
Gather the paperwork
Two years of T1 Generals and Notices of Assessment, your T2125 or corporate financial statements, business bank statements and proof of how long you have operated, such as a business licence or articles of incorporation.
Work out your qualifying income
We apply the add-backs each lender allows and compare them with the 15% gross-up for insured mortgages. Our self-employed income calculator gives you a first estimate.
Choose the lender type
A prime lender if your returns support the mortgage, an insured business-for-self program or an alternative lender if they don't, and private lending only as a short-term step.
Plan the move to prime
If you start with an alternative lender, we look at moving you to a prime lender at renewal, once another year of returns is filed.
Frequently asked questions
You have questions — we have answers!
Self-Employed Mortgages
Can I get a mortgage with less than two years in business?
Sometimes. CMHC recommends 24 months but will look at a shorter history if, for example, you worked in the same field before, bought an established business or have strong cash reserves. Some alternative lenders also accept newer businesses, usually with a larger down payment and a higher rate.
What is a business-for-self mortgage?
An insured program for self-employed borrowers who can't fully document their income the traditional way. Sagen's Business for Self (Alt. A) and Canada Guaranty's Low Doc Advantage both insure purchases up to 90% of the value, so you need at least 10% down, and both look for about two years of self-employment. Sagen asks you to state an income that is reasonable for your industry, needs a credit score of at least 600 when you put down less than 20%, and charges a higher premium than on a standard insured mortgage.
Which expenses can be added back?
For insured mortgages, CMHC limits add-backs to business-use-of-home expenses, motor vehicle expenses and capital cost allowance (depreciation). Uninsured lenders set their own lists, and they vary. We check how each lender treats your particular write-offs before choosing one.
I'm incorporated. What do lenders look at?
Your personal returns and Notices of Assessment, which show the salary and dividends you pay yourself, plus the corporation's financial statements. How much of the company's income a lender will count varies, which is one reason we compare several.
Will being self-employed mean a higher rate?
Not necessarily. If your returns support the mortgage, you can qualify with a prime lender at its regular rates. Business-for-self and alternative lender programs cost more, and private mortgages more again, so the better documented your income, the more choice you have.
Today's rates
Our rates vs the banks'
We shop 50+ lenders, so the rate you're offered isn't limited to one bank's rate sheet. Updated Oct 8.
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Everyone's rate is different. What's yours?
Our job is to find you a competitive rate and terms that fit. Your rate qualification depends on certain factors, such as credit score and home equity, as per Canadian regulations. Get your details fast — there's no cost and no obligation.
- Current variable mortgage rate
- 3.70%
- Current prime rate
- 4.45%
| Term | Bank posted | Our rates | Action |
|---|---|---|---|
| 6 Months | 7.89% | 4.79% | Get this rate: 6 Months |
| 1 year fixed | 5.49% | 4.64% | Get this rate: 1 year fixed |
| 2 year fixed | 5.44% | 4.44% | Get this rate: 2 year fixed |
| 3 year fixed | 6.05% | 4.54% | Get this rate: 3 year fixed |
| 4 year fixed | 6.01% | 4.39% | Get this rate: 4 year fixed |
| 5 year fixed | 6.19% | 4.69% | Get this rate: 5 year fixed |
| 7 year fixed | 6.41% | 4.79% | Get this rate: 7 year fixed |
| 10 year fixed | 6.81% | 4.79% | Get this rate: 10 year fixed |
| 5 year variable | No bank rate | 3.70% | Get this rate: 5 year variable |
Bank posted rates are the big banks' posted rates published by the Bank of Canada (1, 3 and 5 years) and by Dominion Lending Centres (other terms). Some conditions may apply. Rates may vary from province to province. Rates subject to change without notice. Rates change often and depend on your down payment, credit and property; on approved credit (O.A.C.). E.&O.E.
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Contact info
Call, email or send us a message. We negotiate with over 50 lenders to find the right mortgage for you.
- Our location525 W 8th Ave #800, Vancouver, BC V5Z 1C6
- Phone number778-838-8005
- Email addressinfo@coastalblue.ca