EQUITIS MORTGAGE GROUP SERVICES
Self-Employed
Self-Employed
If you are self-employed, you may have experienced some difficulties in obtaining a mortgage. There are many complications for self-employed individuals when applying and qualifying for a mortgage with a standard chartered bank or a prime lender.
Difficulty in qualifying could be due to factors such as low self-declared income, lack of proof of business, inability to prove income in the orthodox fashion, and large business write-offs. All of these factors have an effect on lenders’ willingness to approve a self-employed individual. Fortunately, there are self-employed programs through both institutional/bank lenders along with alternative B-lenders.
Program Examples
The following are an example of a few self-employed programs that might suit you:
Genworth Canada/Canada Guarantee Business for Self (ALT. A) Program
This program allows low declared self-employed individuals to be able to obtain financing through institutional lenders at best market rates.
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Requirements
- Self-employed (Either Sole Proprietor or incorporated) for minimum two years.
- Credit score above 640. As well, absolutely no derogatory payment history in the past 12 months.
- Downpayment as little as 10%
- Mortgage rate term of 1-5 years for Fixed or 5-year Variable
- Gifted downpayment from an immediate family is allowed. However, minimum 5% of the downpayment has to be from client’s own sources.
- Maximum purchase price: $999,999.
- Latest tax year Notice of assessment required.
- Purchase transactions ONLY
- Purchase has to be a principle residence or a second home.
Case Scenario
- Client is a sole proprietor and owns a hair salon
- Been in business for four years
- 682 credit score with no derogatory payments in the past 12 months
- Gross income for last year was $120,000
- Net declared income before tax was $40,000
- Purchase price: $500,000
- Downpayment: $70,000 from own sources, $40,000 gift from parents
Business Bank Statement Program
This program is best suited for individuals who are looking to either purchase over $1,000,000 or refinance at any valuation. Individuals under this program do not declare much personal income, whereas the income used to qualify is based on the previous six to twelve months of their business performance.
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Requirements
- Must be in business at least for six months, either sole proprietor or incorporated.
- Refinance or purchase transactions eligible.
- Mortgage rate term of 1-3 year fixed
- For purchases, maximum loan amount can be 80% of the purchase price (80% Loan to value)
- For refinance, maximum loan amount can be 75% of the purchase price (75% Loan to value). Some exceptions could be made to go to 80%
- Borrowers can prove their income using six months (in some cases 12 months) of bank statements and show the company’s revenue and expenses. This is if the individual who does not show all of their earnings on 2 years of tax returns and 2 years of of CRA NOAs.
- Ideal for clients who write off a lot of expenses or don’t pay themselves enough reportable income. Typically offered at slightly higher interest rates than those offered by prime lenders.
Case Scenario
- Client is incorporated and owns a restaurant
- Been in business for six years
- 632 credit score
- Gross business REVENUE for last year was $450,000
- Net declared income before tax was $40,000
- Purchase price: $500,000
- Purchase price: $1,100,000
- Downpayment: $120,000 from own sources, $100,000 gift from parents
Bruised Credit Business for Self Program
Program designed for self employed individuals with bruised credit.
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Requirements
- Self-employed borrower has been in business or the same industry for at least six months.
- Owner-occupied and rental properties are eligible.
- Credit score above 500.
- For purchases, maximum loan can be 80% of the purchase price (80% Loan to Value).
- Mortgage rate terms of 1-3 year fixed.
- Minimum six months business bank statements.
Case Scenario
- Client is incorporated and runs a trucking company.
- Been in business for one year.
- 532 credit score.
- Gross business REVENUE for last six months was $100,000.
- Purchase price: $500,000.
- Downpayment: $100,000 from own sources.
What People Have To Say
Check out what people are saying about Equitis Mortgage Group
Purchasing our home was made easier with the help of Okhtay! This was our first home purchase and he was incredibly professional and thorough with every aspect of his work. He explained the steps of the process, he was always quick to respond, and I felt confident he was putting 110% into us as clients. He is excellent to work with and I highly recommend him as your mortgage broker for your next real estate purchase!
Being a first time home buyer meant I was completely new to the whole mortgage process. Okhtay guided me through each step seamlessly, explaining my various options along the way, getting me the best rate, and making sure I felt informed and comfortable throughout each decision.
Not only that; anytime I had any questions, he was a phone call away. I could not recommend Okhtay more. In fact, when my sister needed a mortgage, I made sure he was the one to do it!
Thanks for all your help! You made a stressed, first time home buyer feel at ease. The hardest part of the whole process was walking through the front door!I chose to deal with Okhtay when purchasing my first home after meeting with a few different mortgage brokerages. He was very easy to deal with and did a great job leading me through the process. I didn’t know anything about mortgages, but his professionalism and knowledge made me feel very confident with my investment. I am very happy with the service he provided and have since recommended them to all of my friends and extended family.
My experience working with Okhtay was great. I was a first-time home buyer and he was unbelievably helpful. Okhtay made the mortgage process feel so much less-stressful and he took care of so many details and factors that I wasn’t even aware of. His expertise and experience in mortgages helped me learn so much, but also he helped me secure the best options and products for my purchase. I would highly recommend Okhtay as Vancouver’s top mortgage specialist.
Working with Okhtay was a stress free experience. He was great at educating me with the process and making it as seamless as possible. Being able to find me better then standard interest rates was a great bonus to the already amazing service I received.
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