Income Sources
Income Sources That Can Strengthen Your Mortgage Application
When applying for a mortgage, understanding which income sources lenders recognize can help you prepare a strong application. Here’s a detailed look at the various types of income that may be considered:
Employment Income (Salary or Wages)
Whether you’re paid hourly or on a fixed salary, this is the most straightforward form of income. Lenders typically require proof such as:
A current employment letter
Recent pay stubs
T4 slips
Notice of Assessments (NOAs) from the past two years
A stable employment history over the last two years can strengthen your application. If you’ve recently changed jobs, let us know — we can help assess your eligibility accordingly.
Commissions and Bonuses
Commissions or bonuses may be included, especially if they’ve been consistent over time. If you earn entirely on commission, demonstrating a steady income history over two or more years is crucial to prove mortgage affordability.
Tips and Gratuities
In sectors like hospitality, ride-sharing, or personal services, tips can form a significant part of your income. As long as they are declared on your tax returns and show a consistent pattern, they may be considered by lenders.
Self-Employed Income
If you run your own business or freelance, you can still qualify. Recent changes by CMHC have made it easier, even for those self-employed for less than two years. Lenders will typically ask for:
T1 General tax returns
Notice of Assessments
Business financial statements (for incorporated businesses)
A history of profitability significantly improves your chances.
Rental Income
Earnings from rental properties can also be included. To verify this income, lenders usually request:
T1 Generals showing declared rental income
Or, for newer properties: a valid lease agreement and bank statements showing rental deposits
Investment Income
Income from stocks, bonds, mutual funds, or dividends may be counted if it has been consistent over the past 2–3 years. Keep in mind: speculative or irregular investment gains typically won’t qualify.
Alimony or Child Support
Court-ordered spousal or child support payments can strengthen your application, provided they are consistent and well-documented.
Retirement and Pension Income
Every mortgage application is unique, and income qualification can vary by lender. If you’re unsure whether your income qualifies, we’re here to help. Contact ABA Mortgages for personalized advice and expert guidance tailored to your situation.
Every mortgage application is unique, and income qualification can vary by lender. If you’re unsure whether your income qualifies, we’re here to help. Contact ABA Mortgages for personalized advice and expert guidance tailored to your situation.
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