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Mortgages for the Self-Employed

General Tim Hill, MBA 28 Sep

Brokers are beating the drum for BFS clients

Spreading the word about what brokers can do for clients hasn’t been easy – but there are ways to inform and educate, and in the process, build a book of clients.

“With all the new government regulations that have come out over the last few years, it has affected the self-employed the most,” says Bryan Guertin, principal broker for Mortgage Intelligence Oakville. “CMHC no longer insures stated-income mortgages and the other two insurance companies that still do have really tightened up with the qualifications. Many self-employed are finding out that their bank can no longer help them.”

His recent article in the Hamilton Spectator explains the many ways that brokers work with self-employed Canadians, such as freelancers, contractors and small business owners.

“The timing of this article is perfect,” Guertin told MBN. “We have to make these potential clients aware that there are other mortgage lenders out there that qualify them in a different way to make the numbers work.”

And although BFS clients sometimes end up paying a higher rate, there are ways to keep the numbers down; but it isn’t easy.

“Depending on the equity in their homes, some self-employed deals can be done at best rates,” says Guertin. “I have been a mortgage broker for over 40 years, placing BFS mortgages has always been easy, but we now find them tougher to place.”

The business-for-self client base is simply too large for brokers to ignore, and one that is tailor-made for brokers to engage, says Tom Hickey, VP Operations (Adjudication) for B2B Bank.

“The BFS segment in Canada is growing and represents about 18% of the workforce,” Hickey told MBN. “We see an opportunity to adapt to the changes in the workforce Canada is experiencing.”

And Guertin has seen first-hand his own BFS client base increase.

“In the past, approximately 40% of our transactions were BFS,” he says. “Now we are at 60%.”


by Donald Horne | 28 Sep 2015