Small business owners as mortgage consumers may raise a concern to lenders as to how to verify their income. It’s good for you if the income numbers on your Notice of Assessments from Canada Revenue Agency in recent years are good enough to qualify the loan amount you desire.
However, it’s more often that NOA income does not reflect the actual earning power of the small business owners. Lenders know it very well. Some lenders allow you to gross up your NOA income to some extent. Some lenders create stated income program to accommodate your mortgage needs. Lenders have specific rules and requirements regarding to credit score, Loan-to-Value Ratio, occupancy of property, and property appraisal for their stated income program. In addition, minimum two years in business is also required.
The best stated income program for the small business owners is featured as followed:
- minimum 2 years in business;
- minimum beacon score 660;
- minimum 25% down payment (conventional);
- standard prepayment privilege;
- best interest rate (no premium added on);
- owner occupied or second home only
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