Self-Employed Mortgage in Vancouver with HELOC Flexibility

Case Challenges

Angela and Clifford faced a mix of common and complex challenges that many Canadian business owners see:

• Non-traditional income: Angela’s main income was paid as dividends from two corporations tied to a large accounting firm. Clifford’s income flowed from the same management company. Traditional lenders often struggle to interpret this kind of structure.
• Multiple properties and entities: They owned a rental condo in a downtown Vancouver tower, a hotel room unit in a resort town, and two timeshares. One of these was held in the corporation, and Angela also owned shares in a local retail shop. Lenders needed clarity on which income was personal, which was corporate, and which was passive investment.
• Coordinating sale and purchase: Their existing owner-occupied condo was sold for $1,085,000 with no mortgage on title, and closing in late March. The new purchase at $1,450,000 was scheduled to close in early June. Cash from the sale, plus about $150,000 in savings and investments, would form a large down payment. This timing had to be clearly mapped to reassure the lender the funds would be available.
• Specific product needs: They did not want a large mortgage. Their goal was about a $350,000 mortgage and a strong HELOC option of up to $200,000, with prepayment privileges in the 10–15% range and the ability to make bi-weekly or accelerated payments. They planned to buy another investment property in 4–5 years and wanted flexibility more than maximum borrowing power.
• Detailed lender questions: Because of the corporate structure and excellent incomes (Angela’s average dividend income of $290,876.40 and Clifford’s two-year T4 average of $77,500), the lender requested extra detail: corporate roles, past employers on the credit bureau, reasons for recent credit inquiries, and explanations of differences in strata fee statements on the rental property.

Case Solutions

We treated this file as a full financial picture, not just a simple mortgage application.

1. Clarifying Self-Employed Income

First, we gathered two-year averages for Angela’s dividend income and Clifford’s T4 income. We explained in clear terms how Angela’s professional corporation receives distributions from a major national accounting firm and then pays a management fee to the second corporation, which in turn pays Angela dividends and Clifford salary. This helped the lender see the income as long-term and stable, not short-term or unusual.

We confirmed Angela’s history in public practice, the role of the management company, and where rental income from the hotel unit and condo were reported. This framed their income as consistent and well-documented, not speculative.

2. Mapping Assets, Debts, and Sale Proceeds

Next, we laid out their balance sheet in a way a lender could underwrite easily:

• Personal and business bank accounts with more than enough funds for closing.
• Registered investments (RRSPs) as additional security.
• The rental condo with an estimated value of $650,000 and a small mortgage balance of $116,721.69, plus net rental income of about $2,000 per month.
• The existing home sale, with expected net proceeds of approximately $1,051,875 after real estate and legal costs.

We tied the timeline together so the lender could see that the sale would close before the new purchase and that the down payment would be ready in time.

3. Designing the Right Mortgage and HELOC Structure

Instead of simply targeting the largest possible mortgage, we focused on the structure they wanted. We compared several options with major Canadian banks and alternative lenders, including full mortgages up to $1,600,000 and re-advanceable products offering a mix of term mortgage and HELOC.

Based on their preference for a two-year fixed rate and strong HELOC features, we recommended a structure with a credit union:

• A total authorization of $525,000.
• $325,000 as a 2-year fixed-rate mortgage, 25-year amortization, with monthly payments of $1,953.61.
• A $200,000 HELOC at a floating rate (prime plus 0.50%).

This fit their goals: a small, predictable mortgage payment, flexibility to prepay, and a HELOC to draw on for future investments or business needs.

4. Managing Lender Conditions and Questions

When the lender issued a list of follow-up questions, we coordinated with Angela and Clifford to respond quickly and clearly. We explained prior employers listed on old credit reports, clarified unused credit inquiries, and reconciled strata fee discrepancies on the rental property by relying on annual general meeting records.

This proactive communication led to a clean conditional approval and minimized back-and-forth as closing approached.

Case Results

The final approval matched what Angela and Clifford wanted from the start.

• New home secured: They purchased their new three-bedroom Vancouver condo for $1,450,000. Their strong equity position and excellent credit scores (over 860 and 900) were recognized and rewarded in the approval.
• Custom mortgage + HELOC: The lender approved a $325,000 2-year fixed mortgage with affordable payments and a $200,000 HELOC limit attached to the same property. This gave them both payment stability now and access to capital later, without needing to refinance again soon.
• Smooth timing and funding: Their existing home sale closed first, generating roughly $1,000,000 in proceeds for the down payment. The purchase funded on time with no last-minute issues. Subject removal was requested promptly once the conditional approval arrived.
• Strong future flexibility: With a low mortgage balance, solid HELOC, and their rental property in place, Angela and Clifford are well positioned to consider another investment property in a few years, as they had planned.

For self-employed Canadians with layered corporate and investment structures, this case shows that careful documentation and thoughtful product selection can turn complex finances into a simple, low-stress move to a new home.