If you are self-employed in Canada, you may feel that getting approved for a mortgage is a daunting task. However, with the right preparation and documentation, it is possible to qualify for a mortgage as a self-employed individual. In this blog, we will discuss the steps you can take to improve your chances of getting approved for a mortgage.

Get your financials in order

As a self-employed individual, you will need to provide proof of income to lenders. This can be challenging if you do not have a steady income stream or if your income fluctuates. To address this, you should ensure that your financials are in order. This includes:

• Keeping accurate records of your income and expenses.
• Filing your taxes on time and having up-to-date tax returns.
• Keeping your personal and business finances separate.
• Having a good credit score.

Provide a larger down payment

Providing a larger down payment can help to offset any concerns that lenders may have about your income stability. A larger down payment also reduces the amount of money you need to borrow, which may increase your chances of being approved for a mortgage. The minimum down payment required in Canada is 5% for homes under $500,000 and 10% for homes between $500,000 and $1 million.

Get pre-approved for a mortgage

Getting pre-approved for a mortgage is a good way to know how much you can afford and to demonstrate to lenders that you are serious about buying a home. It also gives you an advantage when negotiating with sellers.

Provide additional documentation

When applying for a mortgage as a self-employed individual, you will likely need to provide additional documentation. This may include:

• Your business license or registration.
• Proof of income, such as tax returns, financial statements, and contracts.
• Proof of employment, such as client contracts or invoices.
• Bank statements showing your business income and expenses.
• A letter from your accountant or financial advisor confirming your income.

Consider alternative lenders

If you are having difficulty getting approved for a mortgage from a traditional lender, consider alternative lenders. These lenders specialize in working with self-employed individuals and may be more willing to consider your unique circumstances.

In conclusion, getting approved for a mortgage as a self-employed individual in Canada requires preparation and documentation. By getting your financials in order, providing a larger down payment, getting pre-approved, providing additional documentation, and considering alternative lenders, you can increase your chances of getting approved for a mortgage and achieving your dream of homeownership.

Apply Now for Your Mortgage Today!

Written By Jay Vyas, Mortgage Agent at Dominion Lending Centres Better Rate Mortgage

Refinancing your home can be a great way to save money, reduce your monthly payments, or even tap into your home’s equity. However, there are several things to consider before making the decision to refinance. In this blog post, we’ll explore what you should consider if you are refinancing.

1. Your credit score

Your credit score is one of the most important factors that lenders consider when deciding whether to approve your refinance application. A good credit score can help you secure a lower interest rate and better terms. Before applying for a refinance, it’s a good idea to check your credit score and take steps to improve it if necessary.

2. Your current mortgage

Before refinancing, it’s important to understand the terms of your current mortgage. For example, are there any prepayment penalties? What is your current interest rate? How much equity do you have in your home? Understanding these details can help you determine whether refinancing is the right choice for you.

3. Your financial goals

It’s important to have a clear idea of your financial goals before refinancing. Do you want to lower your monthly payments? Do you want to pay off your mortgage faster? Do you want to access your home’s equity for home improvements or other expenses? Understanding your financial goals can help you choose the right type of refinance and the best terms.

4. The type of refinance

There are several types of refinance, including rate-and-term refinance, cash-out refinance, and streamline refinance. Each type of refinance has its own pros and cons, so it’s important to choose the one that aligns with your financial goals.

5. The costs of refinancing

Refinancing can come with costs, including closing costs, appraisal fees, and loan origination fees. It’s important to understand these costs and factor them into your decision-making process. In some cases, the costs of refinancing may outweigh the potential savings.

6. Your income and employment status

Your income and employment status are important factors that lenders consider when approving a refinance. Before applying for a refinance, it’s important to have a stable source of income and a steady employment history.

7. The current market conditions

The current market conditions, including interest rates and the housing market, can impact your decision to refinance. If interest rates are low, refinancing may be a good option to secure a lower interest rate and save money. On the other hand, if the housing market is volatile, it may be better to wait until market conditions stabilize.

In conclusion, refinancing can be a great way to save money, reduce your monthly payments, or access your home’s equity. However, it’s important to consider several factors before making the decision to refinance, including your credit score, current mortgage, financial goals, type of refinance, costs, income and employment status, and the current market conditions. By doing your research and making an informed decision, you can take advantage of the benefits of refinancing while minimizing the risks.

Apply Now for Refinancing Your Mortgage Today!

Written By Jay Vyas, Mortgage Agent at Dominion Lending Centres Better Rate Mortgage

Reverse mortgages have become an increasingly popular financial option for Canadian seniors in recent years. A reverse mortgage allows homeowners aged 55 or older to borrow money against the equity in their home, without having to sell or move out. In this blog post, we’ll explore the basics of reverse mortgages in Canada, including how they work, their benefits, and some key considerations to keep in mind.

How do Reverse Mortgages Work?

A reverse mortgage is a loan that allows seniors to access a portion of the equity in their home, which is the difference between the home’s current market value and any outstanding mortgage balance. The loan amount can be paid out in a lump sum, as regular payments, or as a line of credit. The borrower does not have to make any payments on the loan while they are living in the home. Instead, the loan is repaid when the borrower sells the home, moves out, or passes away.

Benefits of Reverse Mortgages:

One of the primary benefits of a reverse mortgage is that it allows seniors to access the equity in their home without having to sell or move out. This can be particularly appealing for seniors who want to stay in their home but are struggling with cash flow or expenses. Additionally, reverse mortgages are not subject to income or credit checks, making them an accessible option for seniors with limited income or poor credit. Finally, because the loan is secured by the home, the interest rates on reverse mortgages tend to be lower than those on unsecured loans or credit cards.

Considerations for Reverse Mortgages:

While there are many benefits to a reverse mortgage, it is important to consider some key factors before deciding if it is the right option for you. First and foremost, reverse mortgages can be expensive. The fees and interest rates associated with these loans can add up quickly, reducing the equity in your home and leaving less for your heirs. Additionally, if you have a partner or spouse who is not on the title of the home, they may not be able to stay in the home if you pass away or move out. Finally, because the loan is repaid when you sell the home, move out, or pass away, it is important to consider how this will impact your estate plan.

Conclusion:

Reverse mortgages can be a powerful financial tool for Canadian seniors, providing access to the equity in their homes and allowing them to stay in their homes without having to sell or move out. However, it is important to carefully consider the costs and potential impacts on your estate plan before deciding if a reverse mortgage is right for you. As with any major financial decision, it is always a good idea to consult with a qualified financial advisor or mortgage professional to ensure you fully understand your options and make the best decision for your unique situation.

Apply Now for Reverse Mortgage Today!

Written By Jay Vyas, Mortgage Agent at Dominion Lending Centres Better Rate Mortgage

If you’re planning to buy a home in Canada, one of the first steps you should take is to get pre-approved for a mortgage. Mortgage pre-approval is a process that involves a lender evaluating your creditworthiness and financial situation to determine how much they are willing to lend you for a mortgage.

Here are some key things you need to know about mortgage pre-approval in Canada:

What is mortgage pre-approval?

Mortgage pre-approval is a conditional commitment from a lender to provide you with a mortgage. It involves a lender evaluating your credit score, income, debt, and other financial factors to determine how much you can afford to borrow.

Why is mortgage pre-approval important?

Mortgage pre-approval is important because it gives you a clear understanding of how much you can afford to spend on a home. It also makes you a more attractive buyer to sellers, as they know you have already been approved for a mortgage.

How do you get pre-approved for a mortgage?

To get pre-approved for a mortgage, you’ll need to provide your lender with documentation of your income, assets, and debts. This includes things like pay stubs, bank statements, tax returns, and credit reports. Your lender will use this information to determine how much they are willing to lend you.

What are the benefits of mortgage pre-approval?

Mortgage pre-approval has several benefits, including:

• Knowing how much you can afford to spend on a home
• Making you a more attractive buyer to sellers
• Helping you budget for your home purchase
• Giving you a better idea of your monthly mortgage payments
• Locking in a mortgage rate for a specific period of time

How long does mortgage pre-approval last?

Mortgage pre-approval typically lasts for 90 to 120 days. However, some lenders may offer longer pre-approval periods.

In conclusion, mortgage pre-approval is an important step in the homebuying process. It gives you a clear understanding of how much you can afford to spend on a home and makes you a more attractive buyer to sellers. By understanding how mortgage pre-approval works and its benefits, you can make informed decisions when buying a home in Canada.

Apply Now for your Pre-Approval Today!

Written By Jay Vyas, Mortgage Agent at Dominion Lending Centres Better Rate Mortgage