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 The
Money Management Newsletter: Home
Ownership
A mortgage that gives the self-employed credit
for great credit
A Product Review, June 2005
Money Management Newsletter
Provided
by John-Andrew Newman, B.Comm., Accredited Mortgage Professional (AMP)
A large and growing segment of Canadians are taking advantage of flexible
or unconventional employment opportunities. In fact, the self-employed
now represent close to 16% of the country's workforce. Today's generation
of contractors, freelancers, consultants, commission sales professionals
and small business owners have come to value independence in their day-to-day
work. Now, that entrepreneurship is no longer penalized when it comes
to mortgage financing.
For many it was an embarrassingly familiar story. They enjoyed a successful
professional life, but when applying for a mortgage, they found themselves
on the defensive - trying to prove that they actually earned enough income
to service the mortgage they wanted, with many turned down because their
income just didn't measure up.
Hard to believe, but true. If you work independently or own a business,
you know that it pays to keep your taxable income as low as possible.
That makes you a smart businessperson. But the story can change when you
try to get a mortgage. Your income - at least on paper - may not support
the mortgage payments, and you could be penalized for smart income management.
For Canadian homebuyers stuck on the income obstacle, there is a new
mortgage from Mortgage Intelligence that does the unthinkable: it doesn't
require you to show your income records. In fact, there is no income declaration
and no Notice of Assessment is required. It doesn't even include your
income as a factor in qualifying you for your mortgage.
"It can't be true", you may be thinking, or there must be some
kind of hitch. In fact, it's both good sense and good business. A myriad
of stated-income mortgages have been launched over the last few years,
but this concept of not including any income figure at all is an idea
that's long overdue.
To assess whether you're a good credit risk, this mortgage looks at your
credit history, verifies your employment and assesses the loan amount
based on your field of work. If you have consistently paid your bills
and your loans then you've demonstrated the financial responsibility that
suggests you can manage your mortgage. Possibly the best news for entrepreneurs
this year!
Provided by John-Andrew
Newman, B,Comm., Accredited Mortgage
Professional (AMP)
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, Fiscal Agents Money Management Newsletter
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