Self Employed Mortgages in Ontario
Running your own business should not stand between you and a home. A self employed mortgage is approved based on how your business actually earns, not just the number left on your tax return after write-offs.
LendToday helps business owners, contractors and freelancers across Ontario get approved, including many the big banks have already turned down. We work with lenders across Canada and show you every realistic option before you choose.
Why Self Employed Borrowers Get Declined
A self employed mortgage works exactly like any other mortgage. The home, the payments and the term are the same. What changes is how the lender confirms your income.
Most business owners write off expenses like vehicles, a home office, equipment and phone bills. That is smart at tax time, but it lowers the income shown on your Notice of Assessment. A big bank usually looks at that one line, decides your income is too low, and says no, even when your business is healthy.
The fix is not to stop claiming expenses. It is to work with a lender who looks at your income the right way, and to present your file so it shows what you really earn. That is what a broker does.
This applies to:
- Sole proprietors and small business owners
- Incorporated owners who pay themselves through their company
- Contractors, freelancers and commission earners
- Anyone a bank turned down because of low declared income
Three Ways Your Income Can Be Verified
There is no single path to a self employed mortgage. The right one depends on your credit, your down payment and how your income shows up on paper.
1. Full Documentation
Your income is confirmed with your last two years of Notices of Assessment and T1 Generals, plus company financials if you are incorporated. Some lenders can add back certain write-offs or gross up sole proprietor income. This route gets you the best rates at banks and prime lenders.
2. Stated Income
When write-offs make your declared income look too low, some lenders accept a reasonable stated income that fits your industry and business size. You back it up with your business registration, NOAs showing no tax owing, and bank statements. Stated income programs usually need good credit and a larger down payment.
3. Bank Statement Program
Some alternative lenders look at 6 to 12 months of business or personal bank statements to see the deposits actually coming in. Your cash flow becomes the proof of income. This is a common route for newer businesses and owners who are paid in irregular amounts.
A Lender, B Lender or Private: Which Fits You?
Self employed borrowers can qualify at every level of lending. Our job is to place you as high on this ladder as your file allows, then help you move up over time.
| A Lenders (Banks And Prime) | B Lenders (Alternative) | Private Lenders | |
|---|---|---|---|
| Best for | Strong credit and solid declared income | Healthy business, low declared income or bruised credit | Urgent timelines, credit issues or files other lenders decline |
| Income proof | Two years of NOAs and T1 Generals, plus financials if incorporated | Stated income or bank statements, backed by business documents | Focused on your home equity and exit plan more than income |
| Down payment or equity | As little as 5% with mortgage default insurance | Usually 20% or more | Usually up to 80% of your home's value |
| Credit | Good to excellent | Fair or recovering credit can work | Credit matters least |
| Typical term | 1 to 5 years or longer | Often 1 to 3 years | Usually 12 or 24 months |
| Cost | Lowest rates | Higher rate, sometimes a lender fee | Highest rate, plus lender and broker fees |
General guide only. Every lender sets its own rules, and approval depends on your full application and the property.
Learn more about B lenders, private mortgages and options for a bad credit mortgage.
How to Qualify for a Self Employed Mortgage
Time in Business
Most lenders like to see about two years of self employment. It is not always a hard rule. If you work in the same field you did as an employee, bought an established business, or have contracts that prove your earnings, you may qualify sooner.
Down Payment
With insured programs from CMHC, Sagen and Canada Guaranty, qualifying self employed buyers can put down as little as 5% on the first $500,000 and 10% on the portion above. Alternative programs usually need 20% or more. A bigger down payment opens more doors.
Credit
Your credit history shows lenders how you manage debt. For CMHC's self employed program, at least one borrower needs a credit score of 600. Paying on time and keeping card balances low helps at every lender. Understand your credit score.
Your Documents Checklist
The more organized your file, the more lenders we can approach for you. Have these ready:
- Last two years of Notices of Assessment
- Last two years of T1 Generals (with T2125 for sole proprietors)
- Business registration, licence or articles of incorporation
- Two years of company financial statements, if incorporated
- 6 to 12 months of business and personal bank statements
- Recent invoices or signed contracts
- GST/HST returns, if you are registered
- Proof of your down payment
Not every lender needs every document. We will tell you exactly what your lender asks for.
What We Can Help You With
Buying, refinancing or freeing up cash, there is a self employed friendly option for each.
How It Works
Share a few details about you, your business and your goal. No obligation, and it takes a few minutes.
We look at how your income is best presented and which lenders fit your situation. You hear back from us within 24 hours.
We lay out each option with its rate, fees and term in plain language, so you can choose with confidence.
Your lawyer finalizes the paperwork and your mortgage funds.
Why Business Owners Choose LendToday
50+ Lenders
Banks, credit unions, alternative and private lenders. If one says no, we know who to call next.
We Speak Business Owner
Our brokers have spent years placing self employed clients, including many turned down by their own bank. We take the time to understand how you earn before we recommend anything.
Credit Rebuilding Guidance
If a consumer proposal, missed payments or high balances are holding you back, we give you clear steps to rebuild your credit so you can move to better rates over time.
Real Example: Self Employed in Durham Region
A Durham Region homeowner was declined by the bank because write-offs lowered their income on paper. Read how we got them approved.
Self Employed Mortgage FAQ
Can I get a mortgage if I am self employed?
Yes. Being self employed does not disqualify you. Banks, alternative lenders and private lenders all offer programs for business owners. A broker matches your income documents to the lender most likely to approve you, including when your bank has already said no.
How many years of self employment do I need?
Most lenders like to see about two years. If you have less, you may still qualify when you work in the same field you did as an employee, bought an established business, or have contracts that prove your earnings.
Can I get a mortgage with only one year of self employment?
It is possible. Some alternative and private lenders will consider a shorter history, especially with good credit, a larger down payment, or invoices and contracts that support your income. You may start with a B or private lender and move to a bank later.
How do lenders calculate self employed income?
It depends on the program. Lenders may use the income on your Notices of Assessment, an average of your last two years, your declared income with certain expenses added back, a reasonable stated income, or the deposits on your bank statements. We present your income the way that qualifies you for the most.
What is a stated income mortgage?
A stated income mortgage lets you state a reasonable income for your industry and business size, instead of relying only on the lower figure on your tax return. You support it with business registration, Notices of Assessment and bank statements. These programs usually need good credit and a larger down payment.
Can I use bank statements instead of tax returns?
Yes, with some alternative lenders. Bank statement programs review 6 to 12 months of business or personal statements to see your real cash flow. Most lenders will still ask for your Notices of Assessment to confirm your taxes are paid.
How much down payment do I need if I am self employed?
With an insured mortgage and full documents, qualifying buyers can put down as little as 5% on the first $500,000 and 10% on the portion above, for homes under $1.5 million. Stated income and bank statement programs usually need 20% or more.
Can I get a self employed mortgage with bad credit?
Often, yes. Alternative and private lenders look more at your home equity and cash flow than your credit score. We also offer credit rebuilding guidance so you can qualify for better terms later. See our bad credit mortgage page.
Do self employed borrowers pay higher rates?
Not always. With well documented income and good credit, you can get the same rates as a salaried borrower. If you need a stated income or bank statement program, the rate is usually higher in exchange for flexibility. We plan your move back to a lower rate as your file gets stronger.
Do you help self employed borrowers outside Durham Region?
Yes. LendToday and its agents are licensed under an Ontario mortgage brokerage and help business owners across the province, from the Greater Toronto Area and Durham Region to Ottawa, Hamilton and London.
Turn Your Business Income Into a Mortgage Approval
Tell us about your business and your goal. A specialist will review your situation and lay out your options clearly, with no obligation.