Are you self employed, incorporated, a contractor, an entrepreneur, or even a freelancer?
Get approved with confidence.
Business owners are told by almost everyone that they won’t qualify for a mortgage. They hear it from their bank, their friends, and even the family.
But when you’re self employed, you usually don’t listen to anyone anyways. Often business success happens because business owners ignore status quo.
The reality is banks often misread business income—or don’t know how to evaluate it. Sometimes it’s because they’re new or inexperienced. Othertimes they just don’t do enough business with self employed mortgage borrowers.
That doesn’t mean you don’t qualify. It means you need a different approach and to work with someone who specializes.
The first step to get a mortgage when you work for yourself is understanding how things are set up.
Then we determine the best way to present you and your business’s information to the lender.
Accordion Content
You can – but if you’re planning to build in your operating corporation that might put you in a difficult legal position.
Builders or trades people could come after your business income or assets.
It could make financing more complicated or expensive.
You should plan the structure out with your accountant, a lawyer, and your mortgage consultant. I am always ready to chat with your accountant/lawyer or provide one if you need it!
Many lenders can also do land financing or a land draw which allows you to purchase the land.
In some cases you may have a more complex structure such a a joint venture partnership. Some lenders have custom mortgage programs that can allow for these.
This depends on the project (construction cost, if you own the land outright or have a mortgage on it already, if there’s a house on the property, and other factors).
Common rule of thumb is the best pricing lenders aim to see approximately 50% of the land value and construction cost in capital. Other lenders are more flexible if needed.
Yes – infact, many construction lenders will use make sense lending instead of rigid policies.
There are typically 3 routes builders take:
First, if you plan to sell, then lenders may want to see some of the units pre-sold. You would then complete the build and sell as planned.
Second, if you plan to living in the home after completion, many lenders will allow you to graduate into standard mortgage financing. If not, then you can refinance into a standard mortgage.
Third, if you plan to rent the property out after completion, you can often graduate into an investment property mortgage. Again, if you can’t then you can refinance into one.
This is a very important part of the planning process so should be thought about at the start.
Stop guessing. Start with a strategy built around how your business operates.
