If you are self-employed and are applying for mortgage, then, you have to prepare because your mortgage broker might tell you that you need to get your supporting documents ready.
See, it is harder for banks to lend money to those whom they think do not have usual, regular jobs. You need not worry, though, for as long as you have the documents that you need, then your application will be approved. Here’s what you need to prepare.
First, they have to know that you really are the rightful owner of your business. The documents you need to prepare depend on the type of business you have, and your role in it.
If you are the sole proprietor, you need trade license, tax returns, HST registration, and master business license. You might also be required to present the following: current vendor’s permit or business license; current safety or health certificate; notice of assessment, and; a business bank account reference letter, as well.
If the business is a partnership, prepare tax returns, HST/GST registration, registration, business name, and business license. It is also essential that you divulge which percentage of the partnership you truly own. The following may be required from you, as well: trade license, liability insurance certificate, business credit report, and a reference letter from the bank.
If it is a corporation, you just have to prepare a corporate profile report, and articles of incorporation, as well. You may also need to prepare your letters of patent, company charter, corporate search, and certificate of assistance, too.
It is also important that you pay downpayment of at least 20 percent of the purchasing price, and have documentation for that ready, as well.
It is also important that they know your business is actually thriving, or at least gaining enough income that you can use to pay off your mortgage with.
For verification purposes, you need to prepare your most recent notice of assessment, financial statements that were individually prepared, and business bank statements from the past 6 months.
They might also want to know about the expenses of the company so prepare an invoice. It is also important that you prepare recent contracts so that they would know more about company revenue, and make company-prepared financial statements as well.
Aside from these, you may also be asked for other documents–these will depend on the kind of business you have, and how successful it is. Mostly, these might come from the commissions department, too.
It does seem like hard work, but if you want to get the best mortgage deals while self-employed, it’s best to just comply. After all, doing these would make you a responsible payer, and you’d have less problems regarding your mortgage. It will definitely make things a whole lot better for you.
For any concerns, don’t forget to ask your mortgage broker. This way, you can be sure of what you’re supposed to do, as he/she will know what your business is like, and has an idea about your budget and lifestyle, too.
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