A lot of Albertans earn a good living in ways that do not fit a standard bank form: commission, seasonal work, contract or gig income, rental income, a recent career change, several part-time jobs or a business that is only a year or two old. Banks tend to average, discount or ignore that income. A mortgage with non-traditional income is about finding a lender who assesses your finances as they really are.
Income banks struggle with
- Commission and bonus income that varies from month to month
- Seasonal and contract work with gaps between jobs
- Rental income that a bank discounts or excludes
- New self-employment without two years of tax returns
- Multiple income streams from several jobs or sources
- Recent career changes even when the new income is higher
Why the bank answer is often no
Bank systems typically average two years of income and apply deductions before calculating what you can afford. If your taxable income is lower than your real cash flow, because of business write-offs or a recent change, the qualifying number falls short of the payment. The result is a decline that says more about documentation than about your ability to pay.
How alternative lenders look at your income
Alternative and private lenders can consider bank statements, contracts, invoices, notices of assessment and letters of explanation. Some products look for reasonability of income rather than a rigid formula. Equity carries most of the weight in private lending, so income evidence supports the file rather than defining it.
What to have ready
- Recent bank statements showing deposits
- Notices of assessment and tax returns, if you have them
- Contracts, invoices or commission statements
- A short explanation of how your income works and why it is stable
- Details of the property and your current mortgage
Planning the move back to a bank
For many people, non-traditional income becomes traditional over time, either because a new business reaches two years of returns or because a new role has a track record. A private mortgage gives you room to get there, and we help plan the refinance once your income can be verified the standard way. You can estimate your numbers with the Private Mortgage Payment Calculator.
If you own a business, see self-employed mortgage solutions. If you have been declined already, read Declined by a Bank or A Lender.
Frequently asked questions
Can I get a mortgage without two years of tax returns?+
Sometimes. Alternative lenders can consider other proof of income such as bank statements, contracts and invoices, and private lenders rely mainly on equity. Options vary by lender and property.
How is commission or seasonal income treated?+
Banks usually average it over a couple of years and may discount it. Alternative lenders can look at your actual deposits and the stability of your work, which can produce a fairer picture.
Will my business write-offs hurt my chances?+
With a bank, write-offs can reduce your qualifying income even when your cash flow is strong. Private lenders lean on equity, so write-offs matter far less, though we still need to understand your ability to make the payment.
Is rental income accepted?+
Some lenders count a portion of rental income and others do not. Alternative products are more flexible, and a self-contained unit in the subject property is often treated more favourably than income from other properties.
What happens when my income becomes easier to document?+
That is usually the time to refinance to a lower-cost bank mortgage. We plan for that from the start so the private mortgage is a bridge rather than a long-term arrangement.
NOW Mortgage is a RECA-licensed brokerage operating under Dependable Mortgage Solutions Corp. Call 587-200-6727 or email lending@nowmtg.ca. Information on this page is general in nature and is not a commitment to lend. Financing is subject to lender approval, property assessment and final documentation. OAC.