Self-employed? You're not a problem to explain away.
Whether you take a salary, dividends, or leave money in the company, we know which lenders look at your real earning power — not just line 150 of your tax return. 2 years of self-employment is enough to qualify with multiple lenders.
2 years self-employedStated-income programsDividend income countsAdds back write-offsBorrow up to 80%Big-6 + alternative options
Just 2 years of self-employment is enough — even if your tax returns show less income than you actually earn. We work with lenders who understand business owners.
Most self-employed Canadians have been told ‘no’ by their primary bank — not because they’re not creditworthy, but because the bank employee at the branch only knows the salaried-T4 mortgage product. They see your line-150 net income (after deductions) and decline you. Meanwhile, you actually earned 2-3× that gross. The right lender uses your real qualifying income, accepts dividend grossed-up math, and adds back legitimate write-offs. We know which lenders do that — by name, by file.
Whether you take T1-General income, dividends, retained earnings, or a mix — we know which Canadian lenders match each income story. Stated-income, BFS (Business For Self) programs, alt-A, and private mortgage solutions are all in our toolkit. 2+ years self-employed = multiple A-lender options. Under 2 years = creative B-tier and private paths. We model your add-backs (depreciation, home office, CCA, vehicle) to maximize qualifying income.
What you get
Why Canadians choose Mortgage Squad Advisors.
A-lenders that accept stated-income with 2 years of T1 + NOA history
Sole prop or corporation? Salary, dividend, retained earnings, or a mix? Years in business? We classify your file in 24 hours and map every lender path open to you. No bureau pull required to begin.
2
Match the lender
Each lender has a different appetite for self-employed income. We pick the most generous on your add-backs and least picky on your structure. We’ll explain rate trade-offs across A, alt-A, and private — and recommend the best fit, not the highest commission.
3
Approve and close
Document list is precise — no fishing expeditions. We push the file through underwriting and keep you out of the weeds so you can keep building your business. Most clean files close in 21-35 days.
How Canadian lenders actually calculate self-employed income
There are four methods, and the one your lender uses can change your approval by six figures. (1) Line-150 net income — the bank-branch default, and the one that declines most business owners because it's your income after every deduction. (2) Two-year average with add-backs — the lender starts from net but adds back non-cash and discretionary deductions (CCA, home office, business-use-of-vehicle), which commonly recovers 20–50% of your stated net. (3) Stated income — an A-lender program where the lender accepts a reasonable income for your industry and tenure instead of line 150, typically with 35%+ down and 700+ credit. (4) Retained-earnings / corporate add-back — a smaller set of lenders adds your corporation's retained profit to your personal draw.
The branch employee only knows method 1. Our entire job is matching your file to the lender using methods 2–4 — by name, by program — so you qualify on what you actually earn.
Salary, dividends, or retained earnings — which gets you the bigger mortgage?
If you're incorporated, how you pay yourself is a mortgage lever most accountants optimize purely for tax. Salary (T4) is the cleanest for lenders — it reads exactly like an employee's income. Dividends (T5) are accepted by most A-lenders over a two-year average, and several gross them up 25–30% to reflect their lower tax treatment, which can lift your qualifying income meaningfully. Retained earnings left in the company are invisible to method-1 lenders but usable with the specialty lenders we work with.
The trap: a tax-optimized structure that minimizes personal income can also minimize your mortgage. We model your qualifying income across salary-only, dividend-only, and a blended structure before you apply — and, where there's time, we'll flag changes to discuss with your accountant ahead of your next filing.
The two-year rule — and how to qualify with less
Most A-lenders want two full years of self-employment with two T1 Generals and Notices of Assessment. But "two years" isn't an absolute wall. With under two years we routinely place files through: a one-year program at a flexible A-lender or credit union when you have prior salaried experience in the same field; a larger down payment (35%+) that opens stated-income; a B-lender alt-A program that accepts a single year of history; or a short private bridge with a mapped refinance to A-pricing once your second NOA lands.
Recently incorporated but doing the same work you did as an employee? That continuity matters to the right lender. We'll tell you in the first call which path your timeline actually supports.
Add-backs: recovering the income your tax return hides
Good accounting minimizes taxable income; mortgage qualifying wants the opposite. Add-backs bridge the two by adding legitimate non-cash and discretionary deductions back to your net. The common ones: capital cost allowance (depreciation — non-cash, almost always added back), business-use-of-home, the personal-use portion of vehicle expenses, one-time or non-recurring costs, and certain amortization.
Example: a contractor shows $48,000 net on line 150 but claimed $14,000 CCA, $6,000 home office, and $5,000 vehicle. The right lender qualifies closer to $70,000 — a ~46% lift that can mean a materially larger approval. We read your statements line by line and pick the lender whose add-back policy is most generous to your specific deductions.
A-lender, alt-A, or private — the self-employed ladder and the exit
Self-employed lending is a ladder, not a verdict. A-lenders (banks, monolines) give the best rates and, on stated or full-doc files with two clean NOAs, price you essentially the same as a salaried borrower. Alt-A / B-lenders (Home Trust, Equitable, Haventree, MCAN) accept looser income docs and one-year histories for roughly +50–150 bps. Private (MIC or individual) is equity-based, often no income docs, and fast — roughly +200–500 bps for when speed or a CRA issue rules out the prime route.
The key is that alt and private are bridges, not destinations. We map the refinance back to A-pricing from day one — usually 12–24 months out, once your filings and credit line up — so the flexibility you need today doesn't become a permanent cost. Carrying CRA arrears? See our /cra-debt-mortgage playbook for consolidating it at mortgage rates.
“As someone who’s been self-employed for six years, every bank visit felt like a lecture about why I didn’t qualify. Mortgage Squad Advisors actually listened, understood how my dividend + salary mix works, and got me approved at an A-lender rate. Saved me $290 a month versus the alt-A quote my bank wanted to push me toward.”
— Marcus O., Self-employed business owner, Calgary AB
FAQ
Common questions, answered.
Don’t see yours? Ask Maya — instant answer, any time.
How long do I need to be self-employed to qualify for a mortgage in Canada?
Most A-lenders want 2 full years of self-employment history with 2 years of T1 Generals and Notices of Assessment. Some go 1 year with offsetting strengths: large down payment (35%+), prior salaried history in the same field, strong beacon score, or a co-applicant with salaried income. Private lenders have no minimum time-in-business — they qualify on equity, not income story.
What documents do I need for a self-employed mortgage?
Standard package: 2 years of T1 Generals (all schedules), 2 years of Notices of Assessment, 2 years of corporate financial statements if incorporated (T2 + financials), 90 days of business banking, articles of incorporation, GST/HST registration (if applicable), and confirmation you’re in good standing with CRA. Plus standard property + ID docs. We send a precise checklist after a 5-minute intake.
What is ‘stated income’ and who qualifies?
Stated income is an A-lender program where the lender accepts a reasonable stated income for your industry, role, and years in business — instead of using your line-150 net income. Common at major banks for BFS borrowers with 35%+ down payment and clean credit (700+). The stated income must be reasonable for your profession (no doubling). Sagen and Canada Guaranty both insure stated-income deals up to 90% LTV in some cases.
What’s the difference between A, B, and private lenders for self-employed?
A = banks/monolines (best rates, strictest income docs, usually 2+ years BFS). B = alt-A lenders like Home Trust, Equitable, Haventree, MCAN (looser income docs, +50-150 bps rate premium, 1-year BFS often accepted). Private = MIC or individual lender (asset-based, no income docs in some cases, +200-500 bps but very fast and flexible). We model all three for every BFS file.
Can I include dividend income from my corporation?
Yes — most A-lenders accept 2 years of T5 dividend income from your own corp. Some lenders gross-up dividends by 25-30% to reflect the tax-equivalent salary (since dividends are taxed lower). If you take both salary + dividends, we layer them. If your corp retained earnings are strong, certain specialty lenders use retained earnings + add-backs to materially boost qualifying income.
Can I qualify based on retained earnings in my corporation?
A small subset of specialty A-lenders and most B-lenders will use retained earnings plus standard add-backs to compute qualifying income — especially valuable for incorporated owners who pay themselves modestly and leave profit in the company. We know which lenders do this and can model the boosted income before you start house-hunting.
What if my T1 income looks low after deductions?
We add back legitimate deductions: capital cost allowance (CCA / depreciation), business-use-of-home, vehicle expenses if not 100% personal, professional development, and certain non-cash deductions. The lender sees your gross qualifying income, not your tax-optimized net. Add-backs commonly recover 20-50% of stated net income for well-deducted files.
Will my rate be higher because I’m self-employed?
On A-lender stated-income or full-doc files: rates are essentially the same as a salaried borrower (0-10 bps premium at most lenders). On B-lender alt-A: you pay +50-150 bps for income flexibility. On private: +200-500 bps but with much faster approval and no income docs. Most BFS clients start on B/private and refinance back to A-lender pricing within 1-2 years once they have 2 clean NOAs.
Can I get a self-employed mortgage with only 5% down?
Yes — CMHC, Sagen, and Canada Guaranty all insure self-employed mortgages with as little as 5% down on the first $500K (then 10% on the portion to $1.5M). The income story must be reasonable and the file documented. Insured BFS files often get the absolute best rates because the lender carries zero default risk. We routinely place new business owners with 5-10% down.
What if I have outstanding CRA debt?
Most A-lenders require CRA debt (personal income tax, HST, payroll) cleared before close. B-lenders often roll CRA debt into a refinance up to 75-80% LTV — letting you consolidate at mortgage rates instead of CRA’s 10%+ prescribed interest rate. Private lenders will fund with CRA arrears in place if equity supports it. See /cra-debt-mortgage for the full playbook.
