Self-Employed Mortgage Calculator

Calculate your mortgage affordability as a self-employed or small business owner. Understand how lenders assess your income and qualify you for a mortgage.

Self-Employed Mortgage Calculator

Lenders use your net income — gross revenue minus business expenses — to assess affordability.

Lenders use net income (gross minus expenses)

Credit cards, loans, car payments

Minimum 5% for properties under $500k

Getting a Mortgage When Self-Employed

Getting approved for a mortgage as a self-employed borrower in Canada requires additional documentation and preparation compared to traditional salaried employees. Lenders need to verify your income stability and ability to repay the loan.

Required documentation

  • 2 years of personal tax returns (T1 Generals with Notice of Assessments)
  • 2 years of business financial statements (if incorporated)
  • Business license or articles of incorporation
  • Proof of business ownership (25%+ stake typically required)
  • Recent bank statements (business and personal)
  • Letter from your accountant (sometimes required)

How lenders calculate your income

Net Income Method (Most Common):
Line 150 (Total Income) minus Line 23200 (Deductions) = Net Income

Add-Back Method:
Net Income + Certain write-offs (depreciation, interest, etc.) = Adjusted Income

Lenders typically average your income over 2 years

Tips for self-employed borrowers

  1. Plan ahead: Minimize write-offs for 2 years before applying
  2. Maintain good credit: Aim for 680+ credit score
  3. Save a larger down payment: 20%+ helps avoid CMHC insurance
  4. Keep detailed records: Organized financials speed up approval
  5. Work with a specialist: Use a mortgage broker experienced with self-employed clients
  6. Consider a co-borrower: A spouse with traditional employment can help
  7. Build banking relationships: Your own bank may be more flexible

Alternative programs

Stated Income Programs

Higher down payment (35%+) and good credit can qualify you without full income verification. Rates are typically 1-2% higher.

Bank Statement Programs

Some lenders use 12-24 months of business bank statements to calculate average income instead of tax returns.

B-Lender/Private Mortgages

If you don't qualify with traditional lenders, B-lenders and private lenders offer more flexible criteria at higher rates.

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