If you’re self-employed in Calgary and earning an income as an influencer, content creator, or through adult entertainment, applying for a mortgage may seem challenging. Traditional mortgage applications often require extensive documentation to prove your income, which can be tricky for those with fluctuating or unconventional earnings. Luckily, there are options, including low doc (low documentation) home loans. But how do these differ from full doc (full documentation) loans? And which one is best for you?
This guide breaks down the key differences and helps you navigate the best path to securing a home loan that fits your situation.
1. What is a Low Doc Home Loan?
A low doc home loan is designed for self-employed individuals or people with irregular income who might not have all the traditional paperwork that banks require, such as tax returns, pay stubs, or an official salary. For those who make their income through non-traditional means, like social media platforms or adult entertainment, it’s a flexible solution that allows you to apply for a mortgage using fewer documents.
Instead of standard income verification, low doc loans allow you to provide alternative forms of proof of income, such as:
- Business activity statements (BAS) or profit/loss statements
- Bank statements showing consistent deposits
- An accountant’s letter verifying your earnings
- Contracts or invoices from clients or platforms like YouTube, Patreon, or Twitch
While low doc loans offer more flexibility, they may come with higher interest rates and stricter requirements such as larger down payments to compensate for the perceived risk.
2. What is a Full Doc Home Loan?
Full doc home loans are the standard type of mortgage that most salaried employees apply for. This type of loan requires you to provide extensive documentation that proves a stable and regular income. If you have all the necessary paperwork, you can qualify for lower interest rates and smaller down payments compared to low doc loans.
Typical documents needed for a full doc loan include:
- Two years of tax returns showing consistent income
- Pay stubs from your employer
- Notice of Assessments from the Canada Revenue Agency
- Bank statements to verify your savings and monthly income
For many self-employed individuals or those with unique career paths, gathering these documents can be difficult or impossible. That’s where low doc loans shine as an alternative.
3. Key Differences Between Low Doc and Full Doc Loans
| Factor | Low Doc Home Loans | Full Doc Home Loans |
| Documentation | Minimal – bank statements, BAS, accountant’s letter | Extensive – tax returns, pay stubs, income slips |
| Interest Rates | Typically higher due to perceived risk | Lower, as income stability is verified |
| Loan-to-Value Ratio | Often lower, may require a larger down payment | Higher, meaning smaller down payments |
| Processing Time | Usually faster due to less paperwork | Longer as more documentation needs verification |
| Eligibility | Ideal for self-employed or those with unconventional income | Suitable for salaried employees or those with full documentation |
4. Which One is Right for You?
Choose a Low Doc Home Loan if:
- You’re self-employed and earn an irregular income through platforms like Instagram, Patreon, or adult entertainment sites.
- You don’t have access to traditional forms of documentation, such as tax returns or salary slips.
- You’re willing to provide alternative forms of income proof and accept slightly higher interest rates.
- You can afford a larger down payment to meet the lender’s requirements.
Low doc loans are perfect for people who can show consistent deposits in their bank account but might not have the paperwork to back up their income over time. If you’re just starting out in your self-employment career or your income fluctuates, this could be the ideal solution.
Choose a Full Doc Home Loan if:
- You have traditional, well-documented earnings (even as a self-employed person).
- You’ve been in business for several years and can provide tax returns, profit/loss statements, and a solid credit history.
- You want access to lower interest rates and higher loan-to-value ratios.
- You can wait through a longer processing time to get the best possible deal.
Full doc loans are best for those who can easily produce standard income documentation and want to benefit from lower costs in the long run. If your self-employed business has been successful for a few years and you can provide the required paperwork, going for a full doc loan might save you money over time.
5. How to Prepare for a Low Doc Loan Application
If you’re leaning toward a low doc mortgage, preparation is key. Even though these loans require less paperwork, you’ll still need to present a strong case to the lender. Here’s how to get ready:
- Organize your bank statements: Ensure that your accounts reflect consistent income and show a stable cash flow.
- Gather invoices and contracts: If you work with clients or earn money through platforms, have documentation ready to prove your earnings.
- Consult an accountant: Getting a letter from an accountant who can verify your income or help produce BAS statements will strengthen your application.
- Save for a larger down payment: Low doc loans may require a down payment of 20% or more, so make sure you have a substantial savings buffer.
6. Working with a Mortgage Broker
If you’re uncertain about which option to choose, working with a mortgage broker who specializes in self-employed individuals can be a game-changer. These professionals are experienced with Calgary’s real estate market and can help you understand which lenders are more open to low doc or non-traditional applicants. A broker can also assist you in navigating any specific hurdles related to your income type, ensuring that your mortgage process is as smooth as possible.
Key Takeaways
Whether you’re an influencer or working in adult entertainment, securing a mortgage in Calgary is within reach. Low doc home loans offer a flexible option for self-employed individuals, though they come with higher interest rates and larger down payments. Full doc loans, on the other hand, offer lower costs but require extensive documentation.
Consider your financial situation and the type of income proof you can provide to determine the best path. And if you need help, a mortgage broker can guide you through the process and match you with the right lender.
