Self-Employment Mortgages Fort Mcmurray

A lender will determine your ability to repay a loan by verifying your income, and self-employed individuals may face a few challenges when applying for a mortgage. Employed individuals can use recent tax returns or pay stubs to calculate their income, but those who are self-employed may not have this kind of information, and their income statements may not be as straightforward. 

Who is considered self-employed?

Anyone who works for themselves rather than for a company and reports self-employment income is considered a self-employed individual. You will, however, have to prove that you have been self-employed for at least two years, and the following are all considered self-employed individuals:

  1. If you own 25% or more of a business, you are considered self-employed, but you will have to provide documentation regarding the business to the lender to evaluate qualifying income. 
  2. Freelancers are self-employed and earn money by providing services to multiple clients. 
  3. Contract workers. Individuals who enter into a contractual agreement with a company to provide specific services for a given period of time in exchange for a fee are considered self-employed. 
  4. Seasonal workers. These kinds of workers provide services to meet a company’s temporary needs at specific times of the year.

When evaluating your eligibility for a loan, lenders will request alternative documentation from self-employed individuals. This can include bank statements, profit and loss financial statements or liquid assets. They will need proof of income and stability, and if your income declines year after year, lenders may deny your mortgage application as they will view the situation as a failing business and will worry about your ability to make payments.

Most lenders will take your net income from the past two years and will add them together, after which they will divide the result by 24. This number will serve as your self-employment income. 

Other ways to show proof of income:

  • Bank statements. This can serve as proof of income when applying for a mortgage, and lenders may ask for 12 to 24 months’ worth of bank statements. 
  • Profit and loss statements. This will show lenders your total revenue, business expenses and profits over a given period of time. 

Self-employed individuals should not feel discouraged when applying for a mortgage because self-employment mortgages do exist, and a reputable mortgage broker will discuss your options. They will help you calculate your income and will present you with mortgage solutions based on this information. They are aware of the challenges self-employed individuals face and will help you get through the process. 


Are you worried about your mortgage approval because you are self-employed? Dominion Lending Centers-Mortgage Mentors (Charlene Elliott) will help you overcome any obstacles that may be in your way. We will discuss your situation and will help you calculate your income to present you with mortgage solutions that make sense. 

We will discuss self-employment mortgage options and will use a mortgage payment calculator to determine accurate numbers. Alberta residents can rely on our services, and you can contact us at any time to learn more about self-employment mortgage options! Call 780-838-1449 today!