Can I Get a Mortgage If I Am Self-Employed in Canada?

Yes. Being self-employed does not prevent you from getting a mortgage in Canada. The main difference is that proving income can require more documentation than for someone receiving a regular salary.

Self-employed income may come from a business, contracts, commissions, dividends, or a combination of sources. It can also change from year to year. Because of this, lenders may need a clearer picture of how the income is earned and supported.

The goal is not simply to show how much the business brings in. The lender needs enough information to understand the income available for the mortgage application and the borrower’s overall financial situation.

How Is Self-Employed Income Reviewed?

There is no single approach that applies to every self-employed borrower.

How income is reviewed can depend on factors such as the type of business, how long it has been operating, how the borrower is paid, and the mortgage product being considered.

For example, a sole proprietor may document income differently from someone who owns an incorporated business. A borrower whose income has changed significantly may also need to provide additional context or records.

This is why a well-organized application can be especially helpful for someone who is self-employed. Clear tax and business records can make it easier to show where the income comes from and how it has developed over time.

Do You Need Two Years of Self-Employment History?

Not in every situation.

Lenders may ask for a history of income to understand how the business has performed over time. Two years of tax records are commonly requested, but that should not be treated as a universal rule for all borrowers or mortgage products.

Someone with a shorter self-employment history may still have mortgage options depending on the complete application and the requirements of the product being considered.

Previous experience in the same industry, established contracts, business history, and supporting financial records may all provide useful context.

Rather than assuming that being self-employed for less than two years automatically means waiting, a licensed mortgage broker can review the situation and help identify any required documentation.

What Documents May Be Needed?

The exact requirements vary, but self-employed borrowers should be prepared to provide more detail about their income and business than a typical salaried employee.

Documents may include:

• Recent personal income tax returns
• Notices of Assessment
• Business financial statements or bank statements
• Business registration or incorporation documents, where applicable
• Contracts, invoices, or other records supporting business activity
• Personal bank or investment statements
• Documents showing the source of the down payment
• Information about existing debts and financial obligations

Not every borrower will need every document on this list. Additional information may also be requested depending on the business, income structure, property, and mortgage application.

Having records organized before beginning the process can make it easier to respond when information is requested.

How Can Business Expenses Affect a Mortgage Application?

Business owners often deduct eligible expenses for tax purposes. Those deductions can reduce the income reported on a tax return, which means business revenue and the income shown for mortgage purposes may look quite different.

That does not mean business expenses automatically prevent someone from getting a mortgage.

How self-employed income is treated depends on the borrower’s business structure, documentation, mortgage product, and applicable underwriting requirements. Certain programs may allow specific adjustments to documented income when their requirements are met, but those adjustments should not be assumed to apply in every situation.

For incorporated borrowers, funds held within the company are not automatically treated the same as personal income for mortgage qualification.

Mortgage planning and tax planning are related but separate issues. Before changing how income is paid or how business expenses are reported, it is important to consider both the mortgage and tax implications with the appropriate professionals.

Are There Specialty Mortgage Programs for Self-Employed Borrowers?

Yes. Marathon Mortgage and its approved mortgage brokers have access to specialty programs for self-employed borrowers, including Self-Employed Alt-A and Low Doc programs.

These programs may help borrowers with limited documentation or those who are unable to provide traditional income verification. Depending on the program and the borrower’s circumstances, alternative documentation may be used to support the mortgage application through a more simplified process.

Eligibility, documentation requirements, rates, terms, and conditions vary by program and borrower. A licensed mortgage broker can help determine which options may apply.

What Else Does a Lender Consider?

Self-employment is only one part of the mortgage application.

A lender may also review:

• Credit history
• Existing debts and monthly obligations
• Down payment and its source
• Property details
• Mortgage amount
• Amortization
• The mortgage product being considered

A borrower can have a successful business and still need to meet the other requirements that apply to the mortgage.

This is why it is more useful to look at the complete financial picture than to focus on self-employment status alone.

How Can Self-Employed Borrowers Prepare?

Good preparation can make the mortgage process easier to navigate.

Keeping personal and business records organized is a useful starting point. It can also help to have recent tax documents available, maintain a clear record of the down payment, and be ready to explain significant changes in income or the business.

Borrowers who are planning a home purchase can also use Marathon Mortgage’s Maximum Mortgage Calculator as a planning tool to explore how income, housing costs, and existing financial obligations may affect the mortgage amount being considered.

For a closer look at potential payments and amortization, the Mortgage Analyzer can help illustrate different mortgage scenarios.

These tools are for planning purposes and do not represent a mortgage approval or guarantee of qualification. Prospective borrowers can also speak with a licensed mortgage broker who works with Marathon Mortgage to discuss available options based on their circumstances.

How Can Marathon Mortgage Help Self-Employed Borrowers?

Marathon Mortgage offers mortgage solutions for self-employed borrowers and makes its mortgage products available through licensed mortgage brokers.

In addition to traditional mortgage options, Marathon Mortgage and its approved brokers have access to specialty programs for self-employed borrowers, including Self-Employed Alt-A and Low Doc programs. These programs may provide additional options for borrowers whose income or documentation does not fit a traditional salaried structure.

Depending on the borrower’s plans, Marathon also offers mortgage solutions for needs such as buying a home, refinancing, and switching an existing mortgage.

A licensed mortgage broker who works with Marathon can help prospective borrowers understand Marathon’s available options, prepare the information required for an application, and provide guidance throughout the mortgage process.

This can be especially valuable when income does not follow a traditional salary structure and the application requires a clearer explanation of the borrower’s business and financial circumstances.

Every application is subject to underwriting review, approval, product availability, and applicable conditions.

Disclaimer: The information provided in this article is for general educational purposes only and should not be considered financial, legal, tax, or accounting advice. Any examples, calculations, payment estimates, or scenarios are illustrative only and are not guarantees or forecasts of future interest rates, mortgage payments, or market conditions. Mortgage rates, products, terms, policies, features, and eligibility requirements are subject to change without notice and may vary based on the applicant, property, province, and transaction. All mortgage applications are subject to underwriting review, approval, and applicable conditions. Every borrower’s situation is unique. Existing Marathon Mortgage clients should contact Marathon Mortgage directly regarding their mortgage, renewal options, or product features. Information is current as of the publication date and may change over time.