Tell Igor about the purchase
Property type, expected price, occupancy and what you are trying to accomplish.
Investment property financing in Ontario
The property has to make sense. So does the financing behind it.
Buying an investment property adds another layer to the mortgage decision.
For business owners and self-employed investors, the pieces a lender reviews can interact in ways that are not obvious from a simple mortgage calculator.
Igor helps you understand the financing position before you commit to the investment.
Initial consultation at no cost · No credit check required to start · Nothing submitted without your approval
The lender may need to understand
- Your personal or business income
- The rental income from the property
- Mortgages you already carry
- Your available down payment
- The property itself
- How the new debt fits into your overall financial picture
Since 2010
Mortgage professional
Former Scotiabank, CIBC & RBC Mortgage Specialist
FSRA Mortgage Agent Level 1
Licence #M26000762
Serving Ontario
In person, office, phone or Zoom
Financing is only one part of the deal
A mortgage approval does not make a property a good investment.
The mortgage professional’s role is to help you understand the financing.
It is still your responsibility, with the appropriate professional advice where needed, to decide whether the investment itself makes sense.
Before financing a rental property, consider questions such as:
- What rent is realistically achievable?
- What are the property taxes?
- What are the condominium or maintenance costs?
- What will insurance cost?
- What should you budget for repairs and vacancies?
- How much capital are you putting into the property?
- What happens if interest rates or expenses change?
- Does the property still work if the numbers are less favourable than expected?
Then ask:
How will a lender look at it?
That is where Igor can help.
Rental property mortgages are not just home mortgages with a tenant
The lender looks at both you and the property.
Depending on the lender and transaction, qualification can involve:
Your income
Salary, dividends, self-employed income, commissions, rental income and other supported income sources may all be relevant.
Existing properties
Mortgages, taxes, condominium fees and rental income from properties you already own can affect the application.
The subject property
Expected or existing rental income may form part of the lender’s analysis.
Your down payment
The amount and source of the funds must meet the requirements of the mortgage being considered.
Credit and existing debt
Your other obligations still matter even when the property produces rental income.
Property type
A condominium, single-family rental, duplex, triplex or fourplex may be treated differently depending on occupancy and lender policy.
The useful question is not:
“How much rent does the property generate?”
It is:
“How will this lender incorporate the rental income into the application?”
One distinction changes a lot
Will you live in the property?
An owner-occupied property with a rental unit is not necessarily treated the same way as a property purchased entirely for investment. For example:
Owner-occupied multi-unit property
You live in one unit and rent the other unit or units.
vs.
Non-owner-occupied rental
You do not intend to live in the property.
The available mortgage-insurance, down-payment and rental-income rules can differ materially between those situations.
Tell Igor how the property will actually be used before relying on a generic down-payment rule you found online.
How much of the rent counts?
A $3,000 monthly rent does not automatically mean the lender adds $36,000 to your income.
Lenders and mortgage programs may use different approaches to rental income.
Depending on the situation, the calculation may consider:
- A percentage of gross rent
- Net rental income after certain expenses
- Existing lease agreements
- Market rent supported by an appraisal
- Or another lender-specific method
Existing rental properties can also affect qualification differently from the property being purchased.
That is why two lenders can look at the same portfolio and produce different qualification results.
When business income and rental income meet
More income sources can mean more documentation — not necessarily more simplicity.
A business owner purchasing investment property may have:
- Salary
- Dividends
- Retained corporate earnings
- Rental income
- Partnership income
- Commissions
- And multiple properties
On paper, that can be a strong financial position.
It can also create a complicated mortgage file.
The objective is to make the application understandable:
- What income can be supported?
- What obligations have to be counted?
- How will existing rentals be treated?
- How much liquidity remains after the purchase?
- Which lenders may fit the overall structure?
Igor starts with the full picture rather than evaluating the new property in isolation.
Capital into the deal
Investment-property down payments can work differently from owner-occupied purchases.
For a non-owner-occupied rental property, you should not assume that the minimum down-payment rules advertised for a principal residence apply.
The amount required can depend on:
- Whether you will occupy the property
- Number of units
- Property value
- Mortgage-insurance eligibility
- Lender
- And the overall strength of the application
The source of the funds may also need to be documented. If the down payment is coming from:
- Savings
- Another property
- Business funds
- Investments
- Or borrowed funds
discuss the structure before moving money.
Business funds in particular may involve accounting or tax consequences outside the scope of mortgage advice.
Personally or through a company?
How you hold the property can affect the financing.
Some investors consider purchasing real estate personally.
Others consider a corporation or another ownership structure.
That decision can affect much more than the mortgage. It may involve:
- Tax
- Accounting
- Liability
- Estate planning
- Ownership
- And financing considerations
Igor can explain mortgage implications within his scope.
The broader ownership decision should be made with the appropriate tax, accounting and legal advice.
Do not create an ownership structure solely because you assume it will make the mortgage easier.
Your second property is not your tenth
Qualification can change as the portfolio grows.
The numbers that worked for the first investment may not produce the same result later.
If you plan to acquire multiple properties, financing should be considered before each purchase rather than assuming yesterday’s lender strategy will scale indefinitely.
Each additional property can add:
- Another mortgage
- More rental income
- Property taxes
- Condominium or maintenance expenses
- And more documentation
A useful financing conversation asks:
What works for this purchase?
and
What does this decision do to the next one?
What Igor reviews
Look at the whole transaction.
1
The property
- Purchase price
- Property type
- Occupancy
- Expected or existing rent
2
The down payment
- How much?
- From where?
- What remains afterward?
3
Your income
- Business income
- Employment income
- Rental income
- Other supported sources
4
Your existing portfolio
- Mortgages
- Rental income
- Property expenses
- Other liabilities
5
Potential financing routes
- Which available lender structures may fit?
- What are the costs?
- What are the trade-offs?
Then you decide whether the financing supports the investment you are considering.
How it works
Understand the financing before committing to the property.
Review the financial picture
Income, down payment, existing properties and obligations.
Identify potential lending routes
Review how suitable lenders may assess the transaction.
Understand the conditions
Know what documentation, property information or appraisal may be required.
Decide
You decide whether to proceed.
Nothing is submitted without your approval. Final approval remains with the lender.
Igor Perett
Mortgage Agent Level 1 · Licence #M26000762
Why work with Igor
Investment financing gets more valuable when someone understands the rest of your financial picture.
Igor Perett has worked in mortgages since 2010, including previous Mortgage Specialist roles with Scotiabank, CIBC and RBC.
Today, as a Mortgage Agent Level 1 with Affinity Mortgage Solutions Inc., Dominion Lending Centres, Igor works with borrowers across Ontario.
His focus on business owners and self-employed borrowers is particularly relevant when investment-property financing involves multiple income sources, corporations or an existing real-estate portfolio.
Mortgage Agent Level 1, Licence #M26000762
Affinity Mortgage Solutions Inc., Dominion Lending Centres, Brokerage #13093
Independently owned and operated
Serving clients across Ontario in person wherever suits you, at the office, by phone or on Zoom, in English and Russian.
Investment property mortgage questions
Frequently asked questions
For a non-owner-occupied 2-to-4-unit rental property, a 20% minimum equity requirement is common and is reflected in CMHC’s current Income Property program.
Owner-occupied multi-unit properties can be treated differently.
Actual requirements depend on the property, occupancy, lender and mortgage program.
Potentially. Lenders can consider rental income, but the way they calculate it varies.
Some approaches use a portion of gross rent while others use net-rental calculations or other lender-specific methods.
Potentially, subject to the lender’s requirements.
The lender may require a lease, appraisal market-rent estimate or other supporting information.
Potentially. Self-employed income can be considered where it can be supported under the lender’s requirements.
The complete application still matters.
How self-employed income is assessedPotentially, if appropriate financing is available and you qualify for it.
Using home equity increases your secured borrowing, so both the refinance and the investment purchase should be evaluated together.
Read about refinancingSome financing structures may allow corporate borrowers or ownership.
Mortgage availability can differ from personal ownership, and there are tax and legal implications outside mortgage advice.
Discuss the ownership decision with your accountant and lawyer.
No. The lender assesses more than property cash flow.
Your income, existing debts, credit, down payment, other properties and the property itself can all affect the decision.
This page is primarily about residential mortgage financing.
Properties outside Igor’s licence scope or requiring a different type of commercial financing may need to be referred to an appropriately licensed or specialized professional.
Before the offer becomes firm
Know whether the financing supports the investment.
Understand the property. Understand the rental-income treatment. Understand your qualification. Understand what this purchase does to the rest of your portfolio.
Then decide.
Initial consultation at no cost · No credit check required to start · Nothing submitted without your approval