Buying a home is stressful enough, and being self-employed can make the mortgage part feel even more complicated. You’re not imagining it—major lenders do tend to look a little harder at people who work for themselves. But while it can take more paperwork and preparation, getting approved is absolutely possible with the right approach.
Here’s a simplified, friendlier version of what the process looks like, using only the facts provided.
Why It’s a Bit Trickier
Even though the pandemic led to a “Great Resignation” in parts of North America, Canada actually went the other direction. Before the pandemic, there were nearly 2.9 million self-employed Canadians. Today, it’s a little over 2.6 million, with many people shifting back into full-time employment across various industries—including professional and technical services.
For those who are still self-employed, the work is rewarding, but gathering credit and applying for loans (including mortgages) can feel like an uphill climb. Lenders simply want to see proof that your income is steady enough to handle regular mortgage payments and pass the stress test.
Here’s how to improve your chances.
7 Ways to Make Mortgage Approval Easier When You’re Self-Employed
1. Show Your Self-Employment Track Record
If you’ve been self-employed for fewer than two years, it’s harder to prove income stability. More than two years gives you a strong track record and makes things much easier for lenders to assess.
2. Provide Income Tax Assessments
Your Notices of Assessment from the CRA for the last few years are some of the strongest documents you can provide. They confirm exactly how much you’ve earned and show lenders that your income can support something like a $500,000 mortgage.
3. Be Ready With Extra Documentation
Self-employed buyers are often asked for more paperwork. It’s normal.
Common requests include:
Bank statements
A list of assets (savings and investments)
A list of debts and monthly payments
Other sources of income
Proof of employment status (business licences, client referrals, reference letters)
The more organized you are, the smoother the process.
4. Reduce Your Debt
Lenders scrutinize debt more heavily for self-employed applicants. Paying down things like car loans, credit cards, or student loans can make a noticeable difference.
It’s not always easy—especially with inflation, rising costs of living, and higher interest rates—but it does help your approval odds.
5. Improve Your Credit Score
A higher score makes you look more “creditworthy.”
In Canada:
A good credit score is 660–724 (Equifax)
760+ is considered exceptional
Ways to help boost it:
Pay bills on time
Don’t cancel credit cards
Maintain a mix of credit types
Check your credit report for errors
Pay off old debts
Avoid unnecessary spending
6. Save a Stronger Down Payment
Minimums in Canada:
5% for homes under $500,000
5% on the first $500,000 + 10% on the rest for homes over that amount
A larger down payment helps strengthen your application—but don’t use every dollar you have. Lenders want to see that you still have a rainy-day fund.
7. Keep Cash Reserves
Beyond the down payment, lenders want to see that you can cover mortgage payments if something unexpected happens—illness, job loss, slow business months, etc. Cash reserves show stability.
The Bottom Line
Yes, getting a mortgage while self-employed can take more work. But it’s far from impossible. With the right documents, the right preparation, and the right lender, many self-employed Canadians qualify for mortgages every year—some for 25-year terms.
