How To Get A Mortgage After Bankruptcy

Josh Perez • April 23, 2025

Sometimes life throws you a financial curveball. Bankruptcy and consumer proposals happen. It doesn’t mean your life is over, and it doesn’t mean you won’t ever qualify for a mortgage again.


The key to financial success here is getting things under control as quickly as possible. You must demonstrate to the potential lenders that what happened in the past won’t happen again in the future.


So if you’re thinking about getting a mortgage post-bankruptcy, lenders will want answers to the following questions:


How long have you been discharged?


Securing a mortgage will be dependent on how long it has been since you were discharged from your bankruptcy or consumer proposal. Most lenders consider the discharge date on both to be your new ground zero.


And while there is no legally defined waiting period for when you can apply for a new mortgage post-bankruptcy, what lenders will assess is how you’re managing your finances after your financial troubles.


Have you established new credit?


You can show lenders that they can trust you after bankruptcy by establishing new credit and managing that credit flawlessly. So as soon as you’ve been discharged, it’s a good idea to get a secured credit card and start rebuilding your credit score.


To be considered completely established, you’ll want to have two years of credit history on two trade lines with a credit limit of $2500 on each trade line. You’ll also want to make sure that you have no late or missed payments.


How much do you have available for a downpayment?


The more money you have to put towards purchasing a property, or the more equity you have in your property in the case of a refinance, the better your chances of getting a mortgage. The more money you bring to the table, the more comfortable a lender will feel about the risk they take of losing their investment should you run into future financial difficulty.


What is your total debt service ratio?


Another consideration lenders will look at is how much money you make compared to the cost of making your mortgage payments. So it probably goes without saying that the more money you make compared to the amount you want to borrow, the better.


Conventional or insured financing.


If you’re looking to get the best mortgage products available, here are some of the things a lender will want to see:


  • You’ve been discharged for at least two years plus a day.
  • You’ve established your credit (as listed above).
  • You have at least 5% down for the first $500k of the purchase and 10% down for anything over $500k.
  • If you don’t have a 20% downpayment, you will be required to secure mortgage insurance through CMHC, Sagen (formerly Genworth), or Canada Guaranty.
  • The cost to service the property and all your debts don’t exceed 44% of your gross income.


Alternative lending


As independent mortgage professionals, our job is to provide solutions and strategies for our clients. As such, in addition to dealing with many traditional lending institutions, we also have access to lenders who specialize in working with clients whose financial situation isn't all that straightforward. These private lenders offer alternative lending solutions that consider the overall strength of your mortgage application.


While you won’t qualify for the best rates and terms on the market by going with an alternative lender, if you’re looking for options, you might find that alternative lending is a very reasonable solution for you. Alternative lending isn’t for everyone, but it’s an excellent solution for some, especially if you’ve gone through a bankruptcy or consumer proposal and need a mortgage before fully establishing your credit.


Get in touch anytime.


So whether you’re looking for a plan to help you qualify for a mortgage with the most favourable terms or if you need something more immediate. Please connect anytime. It would be a pleasure to outline your options and work on a plan to get you a mortgage.


Josh Perez
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Why Self-Employed Individuals Should Avoid Going Directly to the Bank for Their Mortgage

By Josh Perez • April 22, 2025
As a self-employed business owner, getting approved for a mortgage can feel like an uphill battle. If you’ve been heading straight to the bank for help, it’s time to rethink that approach. There are two main reasons why this could be a bad idea: the people you’re dealing with and the products they offer. Let’s break down why these two factors can cause problems for self-employed individuals seeking a mortgage. The People: Lack of Expertise There’s a growing trend in banks today, one that’s getting worse with every passing year: more and more bank employees are lacking the necessary experience in financial planning, particularly when it comes to understanding business owners. This leads to a crucial misunderstanding of how businesses operate, which can directly impact the approval process for a mortgage. When you go to the bank, the person you’re dealing with may not ask the right questions or dive deep enough into your business’s financial health. They might focus too heavily on what you personally take out of your business, instead of getting a full picture of how your business operates and its potential for growth. The lack of this understanding means your mortgage application could be misjudged, leaving you without the approval or terms you need. The Products: Not Designed for Business Owners The second issue is the products that most banks offer to business owners. Traditional bank products often base their qualification process on the personal income a business owner takes out of their business. For many entrepreneurs, this creates a problem because it’s often in their best interest to leave more money within the business rather than withdrawing it personally. This is especially true when trying to grow a business sustainably. By focusing solely on personal income, banks miss a huge part of the picture. A business owner’s true financial strength is not just in the salary they pay themselves, but in the overall health and future potential of their business. When banks ignore this, they miss opportunities to offer better mortgage products that take into account the business’s long-term financial viability. The Alternative: Working with a Mortgage Broker As a mortgage broker, my role is to work with a wide variety of lenders who take a common-sense approach to self-employed business owners. Instead of just looking at personal income, we dive deep into the overall financial health of the business itself. This involves looking at how the business operates, understanding its financial structure, and making sure that your business’s potential for growth is properly recognized. One of the biggest benefits of being a business owner is the ability to retain earnings within the company. By doing this, you can avoid the highest personal tax rates and use the extra funds to grow your business sustainably. But when you go directly to a bank, they might penalize you for not taking out large amounts personally. A mortgage broker, however, can work with you to ensure that your business’s growth strategy is taken into account, helping you secure a mortgage that fits your long-term goals.  In Conclusion If you’re self-employed and you’re planning to get a mortgage, it’s time to stop going directly to the bank. Instead, work with a mortgage broker who understands the unique needs of business owners. A mortgage broker will help you navigate the complexities of self-employment and find mortgage products that are more in line with your business’s health and future potential. Don’t let banks’ limited understanding of your financial situation stand in the way of your homeownership goals. Take the smart route and get the right support to secure a mortgage that works for you and your business.

Bank of Canada Rate Announcement Apr 16th, 2025

By Josh Perez • April 16, 2025
Bank of Canada holds policy rate at 2¾%. FOR IMMEDIATE RELEASE Media Relations Ottawa, Ontario April 16, 2025 The Bank of Canada today maintained its target for the overnight rate at 2.75%, with the Bank Rate at 3% and the deposit rate at 2.70%. The major shift in direction of US trade policy and the unpredictability of tariffs have increased uncertainty, diminished prospects for economic growth, and raised inflation expectations. Pervasive uncertainty makes it unusually challenging to project GDP growth and inflation in Canada and globally. Instead, the April Monetary Policy Report (MPR) presents two scenarios that explore different paths for US trade policy. In the first scenario, uncertainty is high but tariffs are limited in scope. Canadian growth weakens temporarily and inflation remains around the 2% target. In the second scenario, a protracted trade war causes Canada’s economy to fall into recession this year and inflation rises temporarily above 3% next year. Many other trade policy scenarios are possible. There is also an unusual degree of uncertainty about the economic outcomes within any scenario, since the magnitude and speed of the shift in US trade policy are unprecedented. Global economic growth was solid in late 2024 and inflation has been easing towards central bank targets. However, tariffs and uncertainty have weakened the outlook. In the United States, the economy is showing signs of slowing amid rising policy uncertainty and rapidly deteriorating sentiment, while inflation expectations have risen. In the euro area, growth has been modest in early 2025, with continued weakness in the manufacturing sector. China’s economy was strong at the end of 2024 but more recent data shows it slowing modestly. Financial markets have been roiled by serial tariff announcements, postponements and continued threats of escalation. This extreme market volatility is adding to uncertainty. Oil prices have declined substantially since January, mainly reflecting weaker prospects for global growth. Canada’s exchange rate has recently appreciated as a result of broad US dollar weakness. In Canada, the economy is slowing as tariff announcements and uncertainty pull down consumer and business confidence. Consumption, residential investment and business spending all look to have weakened in the first quarter. Trade tensions are also disrupting recovery in the labour market. Employment declined in March and businesses are reporting plans to slow their hiring. Wage growth continues to show signs of moderation. Inflation was 2.3% in March, lower than in February but still higher than 1.8% at the time of the January MPR. The higher inflation in the last couple of months reflects some rebound in goods price inflation and the end of the temporary suspension of the GST/HST. Starting in April, CPI inflation will be pulled down for one year by the removal of the consumer carbon tax. Lower global oil prices will also dampen inflation in the near term. However, we expect tariffs and supply chain disruptions to push up some prices. How much upward pressure this puts on inflation will depend on the evolution of tariffs and how quickly businesses pass on higher costs to consumers. Short-term inflation expectations have moved up, as businesses and consumers anticipate higher costs from trade conflict and supply disruptions. Longer term inflation expectations are little changed. Governing Council will continue to assess the timing and strength of both the downward pressures on inflation from a weaker economy and the upward pressures on inflation from higher costs. Our focus will be on ensuring that Canadians continue to have confidence in price stability through this period of global upheaval. This means we will support economic growth while ensuring that inflation remains well controlled. Governing Council will proceed carefully, with particular attention to the risks and uncertainties facing the Canadian economy. These include: the extent to which higher tariffs reduce demand for Canadian exports; how much this spills over into business investment, employment and household spending; how much and how quickly cost increases are passed on to consumer prices; and how inflation expectations evolve. Monetary policy cannot resolve trade uncertainty or offset the impacts of a trade war. What it can and must do is maintain price stability for Canadians. Information note The next scheduled date for announcing the overnight rate target is June 4, 2025. The Bank will publish its next MPR on July 30, 2025. Read the April 16th, 2025 Monetary Report