Real Estate

How long before my wife can qualify for mortgage after coming under personal business

  • Last Updated:
  • Dec 19th, 2019 1:35 pm
[OP]
Newbie
Nov 4, 2018
16 posts
1 upvote

How long before my wife can qualify for mortgage after coming under personal business

Hello,

Here is the situation.
I have a incorporation more than 2 years old. My wife recently left her permanent job and got a contract and is working under my incorporation now. Provided I pay her salary from incorporation every month, how long before she will be eligible for a mortgage?
I am asking this bcoz I was told by bank that it`s 2 year period when someone is working under personal business.
Please advise.
Thanks
7 replies
Banned
Dec 4, 2019
68 posts
7 upvotes
Hello OP
not related to your question but just curious if it’s better to contract than do a permanent job. Was it tough for
Your wife to find contract?
Deal Addict
Jan 13, 2014
1666 posts
593 upvotes
Calgary
2 years as this is an arms length transaction.
Deal Addict
Jan 13, 2014
1666 posts
593 upvotes
Calgary
although if she has been in the same industry for a while now the bank argue that her income will relatively will be the same and ask an exception and use her two year average.
Newbie
Dec 17, 2019
1 posts
Hi there

Lenders typically require two years' minimum of employment information either within the job or within the occupation to assess her income.
Since your wife just change job, they will most likely want to verify her current contract to have some assurance about the continuity of her income.

The fact that your corporation has 2 years is relevant for your application.
Lenders will ask you for confirmation of corporation ownership and minimum 2 year operation, financial statements and tax assessments.
Deal Fanatic
User avatar
Feb 2, 2014
8575 posts
2450 upvotes
Toronto
masarwar wrote: 2 years as this is an arms length transaction.
It's NOT an arms length transaction, they are owner of the corporation and employee are married.
Kevin Somnauth, CFA
Principal Broker - First Toronto Mortgage - MA (Ontario #13176, BC #X301007)
Real Estate Salesperson - Century 21 Innovative
Deal Fanatic
User avatar
Feb 2, 2014
8575 posts
2450 upvotes
Toronto
I believe you asked this on the mortgage thread and I replied.

For a family business, your wife will need to show how much she declared from the company over the past 2 years. I have one lender that will consider 1 year of declared income plus additional proof (ie 3 months of bank statements and pay stubs). This is on the A side.

Subprime lenders may simply ask for bank statements and pay stubs for the past 6 months - 1 year.
Kevin Somnauth, CFA
Principal Broker - First Toronto Mortgage - MA (Ontario #13176, BC #X301007)
Real Estate Salesperson - Century 21 Innovative
Deal Addict
Jan 13, 2014
1666 posts
593 upvotes
Calgary
CdnRealEstateGuy wrote: It's NOT an arms length transaction, they are owner of the corporation and employee are married.
Sorry brain fart. Its a non arms length transaction.

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