It is becoming more and more common for people to own their own business or to work as an independant contractor. Traditionally banks have not had to deal with applicants like that and as a result the mortgage rules that they follow are often out of touch with the reality of the workforce. New mortgage products have been introduced by some of the smarter lenders that are designed specifically for people who fall under the self employed or business for self category. If this is you, you might want to read on.
I'm self employed too! I understand your situation.
One of the reasons that people choose to operate their own small business is for taxation purposes. And with most of these small businesses, while they are looking to make as much money as possible, they also are trying to reduce their taxable income as close to zero as they can each year so they can avoid paying income tax. This strategy often haunts a business owner when it comes time to borrow money and their financials make it appear that their income is quite low.
New mortgage products on the market take that fact into account. There are some mortgage products that allow the business owner to estimate his true income, instead of providing full financial documents. This is a great program!
Heck, if it wasn't for this program, I wouldn't have been able to buy my own house!
If you are interested in learning more about this type of self employed mortgage, get in touch with us and we will share the details.
Calgary Mortgage Broker