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Old Mar 7th 2015, 11:43 am   #1
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Default How to provide references for bank or house rental when working for yourself?

Hi - Would love advice from anyone in the same situation please.

My husband is Canadian, I'm waiting on my PR. We plan to move over in June. We own a business in the UK and will be working remotely in Canada, invoicing the UK business each month. Therefore our jobs and salaries will remain the same. We should also have a 30 - 35 % deposit for a house purchase.

My question is regarding references for either a house rental or a mortgage. How do we provide these if we are our own employer and we have not previously rented? Will we be able to apply for a mortgage straight away based on our status and employment?

Thanks in advance
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Old Mar 7th 2015, 4:56 pm   #2
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Default Re: How to provide references for bank or house rental when working for yourself?

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Originally Posted by Decisive moment View Post
Hi - Would love advice from anyone in the same situation please.

My husband is Canadian, I'm waiting on my PR. We plan to move over in June. We own a business in the UK and will be working remotely in Canada, invoicing the UK business each month. Therefore our jobs and salaries will remain the same. We should also have a 30 - 35 % deposit for a house purchase.

My question is regarding references for either a house rental or a mortgage. How do we provide these if we are our own employer and we have not previously rented? Will we be able to apply for a mortgage straight away based on our status and employment?

Thanks in advance

I had a similar situation with a family from South Africa a couple of years ago. They owned the company and it was set up that he was managing director and she was an employee. They got their company accountant, back in South Africa, to write a letter detailing the financial health of the company and the salary that was paid to her. They also had a fair amount of money with them in a Canadian bank account, we showed the bank statements to the landlord. They met with the landlords, got on great and moved in the next day. So it can be done.
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Old Mar 7th 2015, 6:20 pm   #3
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Default Re: How to provide references for bank or house rental when working for yourself?

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Originally Posted by HGerchikov View Post
I had a similar situation with a family from South Africa a couple of years ago. They owned the company and it was set up that he was managing director and she was an employee. They got their company accountant, back in South Africa, to write a letter detailing the financial health of the company and the salary that was paid to her. They also had a fair amount of money with them in a Canadian bank account, we showed the bank statements to the landlord. They met with the landlords, got on great and moved in the next day. So it can be done.
Brilliant thank you. We are both directors of the company and we will have the financial accounts with us as well as pay slips etc (and hopefully a chunk of money in the bank!)
It feels a bit daunting leaving behind all our credit history, no claims bonus etc!
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Old Mar 7th 2015, 6:42 pm   #4
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Default Re: How to provide references for bank or house rental when working for yourself?

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...We should also have a 30 - 35 % deposit for a house purchase....
If you can put 35% down you should be able to find a mortgage lender that will not be too worried about references.
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Old Mar 7th 2015, 7:01 pm   #5
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Default Re: How to provide references for bank or house rental when working for yourself?

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If you can put 35% down you should be able to find a mortgage lender that will not be too worried about references.
Good to know, thanks
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Old Mar 7th 2015, 9:24 pm   #6
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Default Re: How to provide references for bank or house rental when working for yourself?

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Brilliant thank you. We are both directors of the company and we will have the financial accounts with us as well as pay slips etc (and hopefully a chunk of money in the bank!)
It feels a bit daunting leaving behind all our credit history, no claims bonus etc!
Bring your UK credit report with you. Basically anything that gives the landlord a good feeling about you. They just want to know that you will be a good tenant, pay your rent and not trash the place. So just think about what would make you feel comfortable about a tenant if you were them, and bring that along. Some landlords are totally inflexible, but most, especially those in areas where there are a lot of immigrants, completely understand.
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Old Mar 9th 2015, 7:57 am   #7
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Default Re: How to provide references for bank or house rental when working for yourself?

https://www.cmhc-schl.gc.ca/en/hofic...r/hopr_008.cfm

For permanent residents, where there is limited Canadian credit history and where foreign credit bureaus are not available, CMHC continues to consider alternative sources of payment history for Loan-to-Value ratios between 80.01% and 95%.

(There are suggestions of what they will accept - so bring documentary evidence of having paid utility bills, mortgage etc and a credit report with you)

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Old Mar 9th 2015, 4:46 pm   #8
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Default Re: How to provide references for bank or house rental when working for yourself?

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Originally Posted by Siouxie View Post
https://www.cmhc-schl.gc.ca/en/hofic...r/hopr_008.cfm

For permanent residents, where there is limited Canadian credit history and where foreign credit bureaus are not available, CMHC continues to consider alternative sources of payment history for Loan-to-Value ratios between 80.01% and 95%.

(There are suggestions of what they will accept - so bring documentary evidence of having paid utility bills, mortgage etc and a credit report with you)

Thank you. I have spoken to our accountant today to get this organised.
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Old Mar 9th 2015, 5:30 pm   #9
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Default Re: How to provide references for bank or house rental when working for yourself?

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Thank you. I have spoken to our accountant today to get this organised.
3 years of business financial statements is what they will look from self employed.
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Old Mar 9th 2015, 6:18 pm   #10
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Default Re: How to provide references for bank or house rental when working for yourself?

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3 years of business financial statements is what they will look from self employed.
Or tax returns for the last 3 years
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Old Mar 9th 2015, 7:40 pm   #11
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Default Re: How to provide references for bank or house rental when working for yourself?

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Or tax returns for the last 3 years
Sometimes, for proprietorships anyway. For incorporated business, lenders often want financials so they get the overall picture. If one has a good accountant, one uses all the allowances one can.

Monies may be held within a company, owners may be drawing down loan account rather than salary, CCAs etc.
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