1. Know your Credit Score. People often think that they shouldn’t check their own credit score as it can adversely affect their rating. However when you check your own score it’s called a “Soft Hit” and does not show up in your credit history. It’s only when another lender checks your score that you see their inquiries – the more you have the more detrimental it can be for a mortgage application. (Only give permission for credit checks if you are fully committed to financing your purchase, whatever it may be.) You can check your personal credit score for free at Equifax Canada. It ranges from 300-900. A score above 680 is considered excellent, and a score below 620 is considered challenging.
2. Financial Discipline. Something as simple as just paying your bills on time can dramatically increase your credit score and begins to build trust with possible lenders. Being consistent when managing both your personal and business financials, along with filing your income taxes with future buying power in mind; can be worth more than your actual numbers.
3. Documentation. When applying for a mortgage, make sure to have ALL your documentation ready. If your record management and bookkeeping are well organized you will have a clear picture of your financials and so will your lender. If your documentation has gaps in it, this creates confusion and can result in either disqualification or a less than favourable rate.
Knowing upfront the extra requirements a self employed individual will need to obtain a mortgage; can smooth an otherwise daunting process. A qualified mortgage planner with Mortgage Architects can definitely help and will come highly recommended.
-They have access to a broad network of lenders. They will work to pair you with the right type of lender based on your financials with the best possible lending product. When you go into a bank you only have access to one.
- They do one credit check which is then used to approach only the right lenders. Going to several banks results in several credit checks.
- They know what documents are required for any type of financial situation and can help make sure your application is complete.
- They know when to submit your approval documents based on the current real estate market activity.
All this and more, at no cost to you! Yes that’s right. FREE!!! Mortgage Brokers are paid on a commission basis by the lender. So why not take advantage of all these tools, resources and experience? If you are self employed and ready to achieve your goals, contact Anita Lemke. She can certainly help pave the way for your success.