Navigating the process of securing a mortgage can feel like a full-time job in itself—especially when you’re self-employed. If your income comes from a less conventional source like being an influencer, content creator, or working in the adult entertainment industry, getting a mortgage may seem even more daunting. However, it’s definitely achievable. This guide will walk you through the specific steps you need to take to secure a self-employed mortgage, with tips that apply to Calgary’s unique housing market.
1. Understand the Challenges of Self-Employed Mortgages
While being your own boss offers a lot of freedom, it can come with challenges when it’s time to apply for a mortgage. Lenders typically prefer to see a steady income, which isn’t always the case for self-employed individuals. For influencers or adult entertainment workers, income can fluctuate dramatically based on trends, gigs, or platforms’ rules.
Because of this variability, lenders may view you as a higher risk compared to salaried employees. However, understanding these challenges from the start will help you gather the right documentation to prove your financial stability.
2. Prepare Your Financial Documentation
The key to securing a self-employed mortgage is demonstrating your ability to manage finances and generate consistent income. For self-employed individuals, this means providing more paperwork than a traditionally employed applicant would need to. The documents you’ll likely need include:
- Two years’ worth of tax returns: This shows your total earnings over time and establishes a baseline for your income.
- Business financial statements: If you operate under a business name, you’ll need statements that show your profits and losses.
- Proof of ongoing income: For influencers or adult entertainers, consider offering contracts, client testimonials, or monthly earnings reports from platforms like YouTube, OnlyFans, or Patreon.
- Bank statements: Lenders may ask for your personal and business bank account statements to see how money is flowing in and out.
Tip: If your income is highly seasonal, it helps to have several months of savings on hand to prove that you can handle your mortgage payments even during a downturn.
3. Check Your Credit Score
Whether you’re self-employed or salaried, a strong credit score is crucial to getting approved for a mortgage. If your credit score is on the lower end, focus on improving it before you apply. This can be done by paying down debts, avoiding new credit inquiries, and making sure all bills are paid on time.
Some lenders might be willing to overlook the volatility of your income if you have a high credit score, so this is a vital piece of the puzzle.
4. Research Lenders Specializing in Self-Employed Mortgages
Not all lenders are created equal, and some are more experienced in working with self-employed individuals than others. Look for mortgage brokers in Calgary who specialize in self-employed mortgages. These professionals understand the unique circumstances of individuals who earn their income through unconventional means and can connect you with lenders who are more likely to approve your application.
Tip: Online lenders or credit unions may also offer more flexibility for non-traditional earners, so don’t limit yourself to big banks.
5. Consider a Larger Down Payment
Another way to increase your chances of getting approved for a self-employed mortgage is to offer a larger down payment. If you can put down 20% or more of the home’s value, lenders may feel more comfortable taking on the perceived risk associated with your fluctuating income.
The larger your down payment, the less money the lender has to loan, which means lower monthly payments and less risk for them. It’s a win-win.
6. Look Into Stated Income Mortgages
Stated income mortgages are designed for people who might not have traditional income documentation, such as influencers or those in the adult entertainment industry. Instead of relying on tax returns or pay stubs, lenders may allow you to “state” your income based on your bank deposits or business performance.
While this might sound ideal, these mortgages often come with higher interest rates or require larger down payments, so weigh the pros and cons carefully.
7. Work With an Experienced Mortgage Broker
When in doubt, having an experienced mortgage broker on your side can make a world of difference. A broker will guide you through the entire process, ensure your application is presented in the best light, and connect you with lenders who are open to non-traditional income sources.
They’ll also help you navigate Calgary’s real estate market, ensuring that you’re getting the best deal possible in a city that’s becoming more competitive by the day.
8. Plan for the Future
Securing a mortgage isn’t just about qualifying today—it’s about setting yourself up for long-term success. As your career evolves, so will your income. Make sure that your mortgage payments are affordable even during your slow months. Building an emergency fund and consistently budgeting for home expenses will give you peace of mind after your mortgage is approved.
Key Takeaways
Getting a mortgage when you’re self-employed, especially in an unconventional career like an influencer or adult entertainment professional, is absolutely possible. Start by organizing your financial records, improving your credit score, and finding the right lender. It’s a journey that may take time, but with the right preparation, you can secure your dream home.
Have questions about getting started? Reach out to a mortgage broker who specializes in self-employed individuals today, and take the first step toward owning your home.
