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Sunday, April 20, 2008

Self-Employed Borrowers

Self-Employed Borrowers

Mortgage Brokers Offer Expert Advice to Self-Employed Borrowers

While self-employed borrowers face some unique challenges in securing a mortgage, we have access to a range of specialized products created for this group.

If you are self-employed, chances are the income shown on your tax returns has been reduced by several legitimate tax “write-offs.” Historically, this situation left self-employed individuals at a disadvantage to those on salary when it came to the mortgage amount for which they could get approved. We have access to an arsenal of mortgage products that will recognize “undeclared income” or allow declared income to be “grossed up.” These products will allow a self- employed borrower to qualify for a larger mortgage than has traditionally been available.

There are also a range of new mortgage product features recently introduced into the Canadian marketplace that make it easier for self-employed individuals to get a mortgage.

If you are self-employed and have had some credit issues, a mortgage broker may still be able to arrange a mortgage without the standard proof of income.

For expert advice on getting a mortgage that suits your individual needs, call us today.


Saturday, April 5, 2008

Tips for Boosting Affordability

Boosting Affordability

Tips for Boosting Affordability

For first-time buyers affordability is a key issue as they look for a home of their own. Fortunately, there are some ways to increase mortgage affordability and stretch one’s housing dollar. Here are some tips to consider:

Know what you can afford. A mortgage pre-approval helps you establish a price range and the maximum mortgage you can reasonably afford. Many lenders will lock-in a rate for up to 120 days when pre-approving potential borrowers for a mortgage.

Revisit your current debts. When applying for a mortgage, a lender will look at your total debt service ratio (TDS), or how much of your total income is going towards various types of debts, including car loans, credit cards, and other consumer loans. A mortgage broker can advise on restructuring your current debt (by increasing the amortization and lowering payments on your car loan, for example), to ensure that your TDS ratio is acceptable to prospective lenders.

Increase the size of your down payment. Increasing the size of your down payment means a lower monthly payment. A common way for first time buyers to come up with more cash for a down payment is to make use of the federal Home Buyers' Plan to withdraw up to $20,000 each from a registered retirement savings plan (RRSP) without tax penalty to buy or build a qualifying home. Also, many lenders allow the down payment to come from a properly documented gift, and a borrowed down payment may be possible for some borrowers.