1Lenders start with your guaranteed base salary. Bonus, overtime and commission usually count only with a 2-year history.
2Your total monthly housing costs and debts must fit inside limits the lender sets, called debt service ratios.
3Every borrower must pass the federal stress test, which checks you could still pay at a higher rate than you actually get.
4Being on probation does not always stop an approval, especially if you stayed in the same field.
Get ready
What lenders will ask you for
A recent pay stub (within 30 days)
An employment letter showing your title, start date, salary and status
T4 slips and Notices of Assessment for the last 2 years (especially for bonus or overtime)
90 days of statements showing your down payment
Photo ID
Your options
Which kind of lender fits you
Option 1
A lender (banks, credit unions)
Where most salaried borrowers land, with the lowest rates.
Option 2
Insured mortgage (under 20% down)
Lets you buy with as little as 5% down on qualifying homes, with mortgage default insurance added to the loan.
Option 3
First-home programs
The FHSA and the RRSP Home Buyers' Plan can add to your down payment if you are a first-time buyer.
Avoid these
Common mistakes
!Financing a car or furniture right before or during the mortgage process.
!Changing jobs between approval and closing without telling your broker.
!Counting bonus or overtime income that you cannot show for 2 years.
!Forgetting closing costs: land transfer tax, legal fees and moving costs.
Take action
Your first steps
1Ask HR for an employment letter.
2Gather your last 2 years of T4s and Notices of Assessment.
3Check your credit report for free through Equifax or TransUnion.
4Hold off on any new loans or credit cards.
5Start the intake to get a pre-approval amount from a broker.
The intake
What your application will ask
Your online application goes one topic at a time and saves every answer and document as you go, so you can stop and come back. It never runs a credit check, and a licensed mortgage professional reviews it and follows up.
For salaried borrowers
Who is your employer, what is your job title, and is it full-time or part-time, permanent or contract?
When did you start, and are you still on probation?
What is your base salary, and do you earn bonus, overtime or shift premiums? Are they guaranteed?
Do you have any planned leave in the next 12 months (parental, medical, sabbatical)?
Can you provide a recent pay stub, an employment letter and your last 2 years of T4s?
Plus the basics everyone answers 13
Your full name, email, mobile number and the best time to call.
The city you live in, and whether you are a Canadian citizen, permanent resident, or other status.
Are you applying alone or with someone else? If with someone, their name and how you are related.
Your goal: buy, refinance, renew, take out equity, or consolidate debt?
The property type (house, condo, multi-unit) and the city it is in.
Will you live in it, rent it out, or both?
The purchase price or estimated value, and your target closing or renewal date.
Your down payment or available equity, and where it comes from (savings, RRSP/FHSA, a gift, sale of another property).
Your approximate yearly household income before tax.
Your monthly debt payments: car loans, credit cards, lines of credit, student loans, support payments.
Your own estimate of your credit score: excellent, good, fair, poor, or not sure.
In the last 7 years, any bankruptcy, consumer proposal, collections, or missed mortgage payments?
May the broker contact you? (A credit check is only ever run later, with your separate written consent.)
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Answers
Questions people ask
How much mortgage can I afford on my salary?
It depends on your income, debts, down payment and the stress test. A broker can give you a firm pre-approval amount after the intake.
Can I get a mortgage while on probation?
Often yes, especially if you are in the same line of work as your last job. Some lenders ask for the probation period to end first.
Does my bonus count as income?
Usually only if you can show it for 2 years on your T4s, and lenders often average it.
What is the stress test?
A federal rule that checks you could still afford your payments at a higher interest rate than the one you are offered. Everyone borrowing from a federally regulated lender must pass it.
How long does a pre-approval last?
Typically 90 to 120 days, with your rate held for that time.
Does starting the intake affect my credit?
No. It is only questions. A credit check comes later, with your permission.
General information, not mortgage, legal or tax advice. Lender rules change and every application is reviewed on its own facts. Your application and documents are stored privately and go only to a licensed mortgage professional at Top Mortgages Inc; they are never sold, and no credit check is run without your separate written consent.