Real Estate

Mortgage Approval for Self-Employed

  • Last Updated:
  • Dec 30th, 2019 6:47 pm
[OP]
Newbie
Nov 13, 2019
20 posts
13 upvotes

Mortgage Approval for Self-Employed

I have a question re: calculating income for the self employed.

I made a transition to full self-employment (sole proprietorship) in 2019. In 2018, 50% of my income came from traditional employment. I expect most of my future income to come from the business and remain fairly steady/grow slowly.

My understanding is that some lenders will average the last two years of my self employed income to determine how much I can borrow. Is this generally the case for all lenders?

If so, does this mean that I should wait until my 2020 returns are in to apply for a mortgage, in order to maximize the amount I can borrow?

For background, I have no liabilities, a networth far exceeding the value of any prospective home purchase, and no specific timeline for purchasing. I'm located in Vancouver, BC.
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