Stated Income Mortgages for Business for Self Clients

Many self-employed and commissioned sales people write off a portion of their gross income with legitimate tax deductible expenses making their net operating incomes look too low for lenders. However, due to the highly competitive nature of our mortgage market, there are lenders that offer mortgages specifically designed for self employed and commissioned sales people.

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For years it was almost impossible for self employed or commissioned sales people to get financing for a home. Problems consists of:
 
1. Onerous and Intrusive demands: Years of financial records, tax returns and other paperwork made it difficult, if not impossible, to get a mortgage.
2. Fluctuating incomes: Canadians with fluctuation incomes were treated as high risk clients and the amount of mortgages they were offered were far below what they could afford to pay or wanted.
3. Not a long enough history: Business owners and commissioned sales people that had not been in business for 3-4 years could not provide the required documents whereas employees need only be at their jobs a few months.
4. Taxable Income Too Low: Many self employed and commissioned sales people write off a portion of their gross income with legitimate tax deductible expenses. This can make their net operating incomes look too low for the lenders. The problem then becomes, “If I write off all my legal expenses so I pay the least amount of income tax, the lenders won’t like my net income, and if I don’t claim all my legal expenses I will have a higher income that the lenders will like, but I will pay unnecessary taxes. Either way I have a problem.”

Finally there is an answer, Stated Income Mortgages.

Due to the highly competitive nature of our mortgage market, there are lenders that offer mortgages specifically designed for self employed and commissioned sales people. These lenders were smart enough to realise that there is a huge need for this type of product considering the high number of self employed and commissioned people in Canada.

Stated Income Mortgages mean exactly that. They resolve the 4 problems mentioned above:
1.They eliminate most of the documents required making it easier, faster and less intrusive to get a mortgage.
2.Fluctuating incomes from past years are understood.
3.A long business history is not needed, two years of financial statements on tax returns are required. 
4.Taxable income too low; these mortgages are granted on stated income rather than net taxable income. This allows you to continue to use all legal means possible to reduce your income taxes without hurting the possibility of qualifying for a mortgage.

New products – Bigger mortgages – Up to 90% Financing

As more and more Canadians move from traditional employment jobs to self employed or commissioned jobs, the mortgage market is motivated to develop more products.

Up until recently Stated Income Mortgages were limited to a maximum of 75% of the value of the property. Now that GE insurance has joined the market and provided mortgage default to lenders on Stated Income loans, we are seeing loans as high as 90% of the value.

Finally, self employed and commissioned sales people are being treated with the respect they deserve, fast and easy approvals and good discounted rates.
 

We invite you to Contact Us with any questions you have regarding Stated Income Mortgages.