For mortgage lenders, self-employed individuals fall under a special category. Unlike salaried employees, the income for self-employed people fluctuates depending on their business cycles. Secondly, self-employed individuals have the ability to write off more expenses than salaried employees. These write-offs may not truly reflect their earning power.

No Income Qualifying (NIQ)

With a growing number of self-employed individuals in Canada many institutions have designed programs to include these individuals. I can offer what is called No Income Qualifier (NIQ) programs. These mortgages do not require verification of income. The borrower needs to provide a copy of their Notice of Assessment to prove that they do not owe the government back taxes. The borrower may also need to provide recent bank statements or documents like a business license.

Commissioned Sales vs. Self-employed

Some lenders differentiate between commission salespeople and self-employment, applying different lending criteria to each respective class of wage-earners. Not all lenders define commission and self-employment the same way. For some lenders, realtors might be considered as commission sales, whereas other lenders would call them self-employed.

Documents You Can Start to Gather Now

Self-Employed

• Financial Statements of Company.
• NOA's (Personal Notice of Assessments).
• Personal Tax Returns ( T1 Generals showing personal net income).
• Bank statements demonstrating cash flow.

Commission Income

• T4's and/or Personal Tax Returns.
• Job Letter - confirming employment.
• Notice of Assessment (NOA) - optional depending on Lender.

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