Own more than one property? Your next mortgage depends on the whole portfolio.
Lenders look at every property you own, not just the one you are financing. Here is how they count your rents, and how to keep growing or protect what you have.
You've started an application.
Saves as you go · No credit check · A licensed mortgage professional follows up
1Lenders add up the mortgages, taxes and fees on every property you own and compare them with your income plus your rents.
2Different lenders count rent differently. Some add part of the rent to your income; others subtract it from that property's costs.
3Many banks stop at a set number of financed properties. Specialty and B lenders often go further.
4Equity in one property can fund the next down payment, or pay down debt, through a refinance or a line of credit.
Get ready
What lenders will ask you for
A list of every property: address, value, mortgage balance, lender, rate, renewal date and payment
Current leases and proof rent is being received (bank deposits)
Property tax bills and condo fee statements
Last 2 years of tax returns showing rental income (form T776)
Mortgage statements for each property
Your personal income documents (pay stubs or Notices of Assessment)
Your options
Which kind of lender fits you
Option 1
A lender with rental add-back
Lowest rates while your income and rents support the full portfolio.
Option 2
Portfolio or B lender
For investors past a bank's property limit, or whose rents carry most of the debt.
Option 3
Refinance or HELOC
Pull equity from one property to buy the next, renovate, or clear higher-interest debt.
Avoid these
Common mistakes
!Having every mortgage renew at the same time, so one rate jump hits the whole portfolio.
!Not reporting rental income on your taxes; lenders cannot use rent they cannot see.
!Letting a vacancy or rent arrears run without a lease and paper trail.
!Breaking a mortgage early without checking the prepayment penalty first.
Take action
Your first steps
1Build one list of every property and mortgage, with renewal dates.
2Collect current leases and 3 months of rent deposits.
3Find your last 2 years of T776 rental statements.
4Decide your goal: buy, pull equity, consolidate, or sell one.
5Start the intake so a broker can review the whole portfolio.
The intake
What your application will ask
Your online application goes one topic at a time and saves every answer and document as you go, so you can stop and come back. It never runs a credit check, and a licensed mortgage professional reviews it and follows up.
For multiple properties borrowers
How many properties do you own, and how is each held (personal name, jointly, or a corporation)?
For each property: address, value, mortgage balance, lender, rate, renewal date and monthly payment.
For each property: monthly rent, condo fees, property tax, and is it rented right now?
Any vacancies, rent arrears or tenant problems right now?
Your goal for the portfolio: buy another, pull equity, consolidate, or sell one?
Do you report rental income on your taxes (T776), and was it a profit or a loss?
Plus the basics everyone answers 13
Your full name, email, mobile number and the best time to call.
The city you live in, and whether you are a Canadian citizen, permanent resident, or other status.
Are you applying alone or with someone else? If with someone, their name and how you are related.
Your goal: buy, refinance, renew, take out equity, or consolidate debt?
The property type (house, condo, multi-unit) and the city it is in.
Will you live in it, rent it out, or both?
The purchase price or estimated value, and your target closing or renewal date.
Your down payment or available equity, and where it comes from (savings, RRSP/FHSA, a gift, sale of another property).
Your approximate yearly household income before tax.
Your monthly debt payments: car loans, credit cards, lines of credit, student loans, support payments.
Your own estimate of your credit score: excellent, good, fair, poor, or not sure.
In the last 7 years, any bankruptcy, consumer proposal, collections, or missed mortgage payments?
May the broker contact you? (A credit check is only ever run later, with your separate written consent.)
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Answers
Questions people ask
How many mortgages can I have in Ontario?
There is no legal limit. Each lender sets its own, and many banks cap the number of properties they will finance. Specialty lenders often allow more.
How do lenders count rental income?
Either by adding a share of the rent to your income, or by subtracting it from that property's costs. The method can change how much you qualify for by a lot.
Can I use equity in one property to buy another?
Yes, through a refinance or a home equity line of credit, if you qualify for the larger payments.
What down payment do I need for a rental property?
Usually at least 20 percent for a property you will not live in. Owner-occupied homes with rental units can need less.
Should I hold properties in a corporation?
It can affect your taxes and which lenders will finance you. Talk to your accountant and lawyer; your broker can explain the lending side.
Does starting the intake affect my credit?
No. It is only questions. A credit check comes later, with your permission.
General information, not mortgage, legal or tax advice. Lender rules change and every application is reviewed on its own facts. Your application and documents are stored privately and go only to a licensed mortgage professional at Top Mortgages Inc; they are never sold, and no credit check is run without your separate written consent.