Tax Strategies to Help Improve Your Next Mortgage Application
Hugo Dos Reis
Tax season is just around the corner. If you haven’t already started preparing, you’ll want to ensure you’re ready as the process can be very document heavy. The deadlines are April 30th 2019 for personal returns and June 15th 2019 for self-employed submissions.
With mortgage rules consistently changing, having both a strong financing and accounting partner can make all the difference. If you are self-employed, understanding how your income tax returns can influence your mortgage options can save you thousands of dollars. Lenders use the average income for the last two years for self-employed clients. If you have been writing off many expenses and declaring a lower income than you actually earn, you might find it harder to qualify for traditional mortgages. Depending on your financing goals, there is a critical balance of income versus expenses that must be managed in order to qualify for a low-cost mortgage. In some cases, it just makes sense to declare a smaller income if you are willing to go with a non-traditional lender.
We recommend all clients complete an annual mortgage review. Whether buying your first property or looking into your tenth rental property, understanding your options on the financing spectrum and what is required on your tax returns is crucial in allowing for your personal financial growth and interest savings.
Take advantage of connecting with our team for a complimentary portfolio review before finalizing your taxes so we can put you in the best position for any upcoming financing needs.