1 Oct

The Role of a Mortgage Broker in Commercial Lending

Mortgage Tips

Posted by: Gavin Toor

Purchasing a business, refinancing commercial property, or financing expansion can be an exciting step — but it’s also a complex one. Unlike residential mortgages, commercial financing involves stricter requirements, more paperwork, and often much higher stakes. Many business owners and investors don’t realize they have options outside of walking into a bank and hoping for the best. That’s where working with a mortgage broker can make all the difference.

What is Commercial Lending?

Commercial lending refers to financing solutions designed for businesses and investors rather than individual homeowners. This can include:

  • Buying an existing business or franchise

  • Purchasing or refinancing commercial real estate

  • Expanding operations or acquiring equipment

  • Consolidating or restructuring business debt

While the end goal is straightforward — to secure the funding needed — the path is often far from simple.

Why Commercial Financing is Complex

Residential mortgages tend to follow set guidelines, but commercial lending is far more case-specific. Lenders don’t just look at your personal income and credit history; they focus on:

  • Cash flow of the business being purchased or operated

  • Business plans and projections to evaluate long-term viability

  • Collateral such as real estate or equipment

  • Creditworthiness of both the borrower and the business

Every deal is unique, which means finding the right lender and the right structure is crucial.

How a Mortgage Broker Helps

Here’s where the value of a mortgage broker comes in:

  1. Access to Multiple Lenders
    Instead of being limited to one bank, brokers have relationships with a wide range of banks, credit unions, and alternative lenders. This opens the door to better options that fit your specific needs.

  2. Negotiating Terms
    Commercial loans can vary widely in rates, fees, and conditions. A broker works to negotiate on your behalf, ensuring you’re not overpaying or stuck with terms that don’t suit your business.

  3. Packaging Your Application
    Lenders want information presented in a certain way. A broker helps prepare financial statements, forecasts, and supporting documents to strengthen your application.

  4. Problem Solving
    If a traditional bank declines your deal, that doesn’t mean your options are finished. Brokers can connect you with alternative lenders who specialize in unique or complex scenarios.

When Should You Work with a Mortgage Broker?

Some of the most common scenarios where a broker can add value include:

  • Buying a business or franchise

  • Purchasing or refinancing commercial property

  • Expanding operations with new financing

  • Consolidating or restructuring existing business debt

In each case, having a broker in your corner ensures the process is smoother and increases the chances of securing approval.

The Value of Starting Early

Commercial financing takes time. Starting early gives you the flexibility to compare options, address lender concerns, and negotiate the best deal. Even if rates or conditions change during the process, approvals can always be revisited — but having a strong lender offer in place is what ensures your deal closes on time.

Conclusion

Commercial lending can be challenging, but you don’t have to navigate it alone. A mortgage broker acts as your guide, negotiator, and advocate, helping you secure financing that makes sense for your business goals.

If you’re planning to buy a business or need commercial financing, let’s connect — I’ll leverage my relationships with banks and lenders to secure the right financing for your deal.

📞 Ready to discuss? Let’s make sure you’re getting the best possible deal. Contact me at 604-835-4999 or visit gavintoormortgages.com to get started.

22 Sep

Mortgage Renewal Strategies in a Changing Rate Environment

Mortgage Tips

Posted by: Gavin Toor

When your mortgage term comes to an end, it’s easy to assume that accepting your bank’s renewal offer is the simplest route. But in today’s changing rate environment, that could be a costly mistake. Your mortgage renewal is not just paperwork — it’s an opportunity to realign your financing with your financial goals and potentially save thousands of dollars.

In this post, we’ll cover what’s happening with mortgage rates, common renewal mistakes, and the best strategies to ensure your next term works in your favour.

Understanding the Current Rate Environment

Over the last few years, the Canadian mortgage landscape has seen significant shifts. The Bank of Canada has adjusted its policy rate multiple times to manage inflation, directly impacting fixed and variable mortgage rates.

  • Borrowers who secured ultra-low rates in 2020–2021 are now facing renewal offers that could be 2–3% higher.

  • Economic uncertainty means rates may continue to fluctuate, making timing and term selection more important than ever.

If your mortgage is up for renewal soon, being proactive is critical.

Common Mortgage Renewal Mistakes

Many homeowners fall into the same traps at renewal time:

  1. Accepting the First Offer
    Banks often send a renewal letter with a rate offer. It’s convenient — but rarely the best deal.

  2. Waiting Until the Last Minute
    Starting too late leaves little time to compare lenders or negotiate terms.

  3. Focusing Only on Rate
    Prepayment options, amortization adjustments, and portability can be just as valuable as a slightly lower interest rate.

Avoiding these mistakes can make a significant difference in your long-term financial picture.

Smart Strategies for Renewals

Here are proven strategies to help you navigate your renewal:

  • Start Early
    Begin the process at least 4–6 months before renewal. This gives you time to review offers, lock in a rate hold, and compare options.

  • Work with a Mortgage Broker
    Brokers have access to multiple banks and lenders, not just the one holding your current mortgage. This increases your chances of finding better terms.

  • Choose the Right Term Length
    If rates are expected to fall, a shorter term might give you flexibility to secure a lower rate later. If stability is your priority, a longer term may be the right move.

  • Blend and Extend
    Some lenders allow you to combine your existing rate with a new one — this can smooth out payments without waiting until your full term ends.

  • Negotiate Beyond the Rate
    Flexible prepayment privileges, the option to port your mortgage, or adjusting amortization can all provide financial benefits.

Tailored Renewal Approaches

Different borrowers have different needs at renewal:

  • First-Time Homeowners
    Focus on stability. Securing predictable payments may outweigh chasing the absolute lowest rate.

  • Real Estate Investors
    Prioritize cash flow. Structuring the renewal for lower payments can maximize rental income returns.

  • Self-Employed Borrowers
    Income structures can complicate renewals. A broker can help present your application to lenders in the best possible light.

Why Work with a Mortgage Broker for Renewals

Renewals are often treated as a formality by the big banks — but for homeowners, it’s a major financial decision. A mortgage broker can:

  • Access a wide network of lenders.

  • Provide strategies tailored to your personal or business finances.

  • Help you renegotiate more than just your rate, ensuring flexibility for the future.

  • Monitor rate changes and revisit your file if market conditions improve before completion.

Final Thoughts

Your mortgage renewal is a chance to reset, save money, and secure terms that support your financial goals. In a changing rate environment, starting early and exploring your options is more important than ever.

📞 Ready to discuss your upcoming renewal? Let’s make sure you’re getting the best possible deal. Contact me at 604-835-4999 or visit gavintoormortgages.com to get started.

16 Sep

How Business Financing Works in Canada: A Beginner’s Guide

Mortgage Tips

Posted by: Gavin Toor

If you’re planning to buy a business, expand operations, or improve cash flow, understanding how business financing in Canada works is essential. Unlike residential mortgages, business loans are customized to the company’s financials, industry, and growth plans.

In this guide, we’ll cover the basics of how business financing works, the types of loans available, and what lenders look for when approving funding.

🔹 What Is Business Financing?

Business financing refers to borrowing or raising capital to fund operations, acquisitions, or expansion. Financing can be debt (loans you repay) or equity (investors who take ownership).

👉 The right structure depends on your business goals, industry, and stage of growth.

🔹 Types of Business Financing in Canada

1. Term Loans

  • Work like a mortgage: a lump sum borrowed, repaid in installments with interest.

  • Common for equipment, acquisitions, or property purchases.

  • Learn more: BDC Business Loans.

2. Business Lines of Credit

  • Flexible borrowing for short-term needs such as payroll, inventory, or receivables.

  • Interest only on the portion used.

  • Great for managing cash flow financing.

3. Government-Backed Programs

  • Canada Small Business Financing Program (CSBFP) helps finance:

    • Real estate purchases

    • Equipment

    • Leasehold improvements

  • ⚠️ Does not cover goodwill or shares.

  • Resource: Government of Canada – CSBFP.

4. BDC (Business Development Bank of Canada)

  • Specializes in business acquisition financing and growth loans.

  • Can finance goodwill and intangibles that banks won’t touch.

  • Higher rates, but more flexible than traditional lenders.

5. Vendor Take-Back (VTB) Financing

  • In acquisitions, the seller finances part of the price.

  • Reduces upfront cash requirements and complements bank or BDC financing.

6. Private Lenders & Investors

  • Short-term, higher-cost funding (often 10%+).

  • Useful as a bridge until long-term financing is secured.

🔹 How Lenders Evaluate Business Loan Applications

When you apply for business financing in Canada, lenders focus on five key factors:

  1. Cash Flow – Measured by EBITDA (earnings before interest, taxes, depreciation, and amortization) or NIAT (net income after tax).

  2. Collateral – Equipment, property, or personal assets.

  3. Industry Risk – Certain industries (e.g., restaurants, trucking) are harder to finance than stable ones (healthcare, professional services).

  4. Management Experience – Your track record in running or scaling businesses.

  5. Equity Injection – Most lenders require 25–50% down on acquisitions.

🔹 Key Ratios Lenders Use

  • Debt Service Coverage Ratio (DSCR): Cash flow ÷ debt payments. Lenders usually want 1.25x or higher.

  • Leverage Ratios: Debt compared to EBITDA or equity.

  • Liquidity Ratios: Ability to meet short-term obligations (e.g., current ratio).

🔹 Final Thoughts

Business financing in Canada is about more than just interest rates. The right structure balances affordability, flexibility, and long-term growth potential.

✅ Remember:

  • Banks provide lower-cost financing but are conservative.

  • BDC and government programs offer flexibility.

  • Vendor take-back financing can bridge gaps.

Whether you’re looking to buy a business in Canada, expand an existing one, or improve cash flow, the right financing plan can help you grow with confidence.

📚 Helpful Resources

🚀 Ready to Explore Business Financing Options?

Every business is unique — and so are its financing needs. As a mortgage broker with accounting expertise, I help entrepreneurs structure deals that balance cash flow, tax efficiency, and lender requirements.

📞 Call me directly at 604-835-4999
📧 Email me at gavintoormortgages@gmail.com
🌐 Visit gavintoormortgages.com

Let’s discuss how to structure financing that supports your business goals — whether you’re buying, expanding, or restructuring.

9 Sep

How Much Do You Need for a Down Payment in BC?

General

Posted by: Gavin Toor

If you’re planning to buy a home in British Columbia, one of the first questions you’ll ask is:

👉 How much do I need for a down payment?

The rules for minimum down payments in Canada recently changed, and it’s important to know exactly where you stand. Whether you’re a first-time homebuyer in BC, upgrading, or investing, here’s everything you need to know.

Minimum Down Payment Rules in Canada

As of December 2024, the maximum home price eligible for an insured mortgage increased from $1 million to $1.5 million. This means you can buy a home under $1.5M with less than 20% down (if you qualify).

Here’s how it breaks down:

  • Homes up to $500,000 → 5% down

  • $500,001 – $1,499,999 → 5% on the first $500,000 + 10% on the rest

  • $1.5M or more → 20% minimum down payment (insurance not available)

💡 Example: Buying a $1,200,000 home in Surrey:

  • 5% of $500,000 = $25,000

  • 10% of the remaining $700,000 = $70,000

  • ✅ Total down payment = $95,000 (~7.9%)

Insured vs. Uninsured Mortgages

If you’re putting less than 20% down, your mortgage must be insured by CMHC, Sagen, or Canada Guaranty. This protects the lender and allows you to buy with a smaller down payment.

👉 Want a deeper dive? Check out my blog: What is a CMHC-Insured Mortgage in Canada?

With 20% or more down, your mortgage is considered uninsured, meaning no insurance premium—but you’ll need more cash upfront.

💡 New rule: First-time buyers and buyers of newly built homes can stretch amortizations to 30 years on insured mortgages, making monthly payments more affordable.

Don’t Forget Closing Costs in BC

On top of your down payment, you’ll need money for closing costs, which usually add up to 1.5%–2% of the purchase price.

Key BC costs include:

  • Property Transfer Tax (PTT):

    • First-Time Home Buyer Program: Full/partial exemptions up to $835,000 (phased out at $860,000).

    • Newly Built Home Exemption: Full exemption up to $1.1M (phased out at $1.15M).

  • Legal fees and disbursements

  • Title insurance

  • Appraisal or inspection fees

  • Moving costs

Programs to Help You Save for Your Down Payment

  • Home Buyers’ Plan (HBP): Withdraw up to $60,000 from your RRSPs ($120,000 as a couple) tax-free.

  • First Home Savings Account (FHSA): Contribute up to $8,000 per year (max $40,000) with tax benefits, then use it toward your first home.

Why Planning Ahead Matters

Your down payment is just one part of the picture. Lenders also look at:

  • Your income and employment history

  • Your debts and credit score

  • The property type (condo, house, presale, investment)

Working with a mortgage broker in BC gives you access to:

  • Multiple lenders (banks, credit unions, monolines, alternative)

  • Rate holds to protect you while you shop

  • Flexibility to revisit your rate if the market changes before completion

Final Thoughts

Buying in BC is competitive, but knowing how much you really need for a down payment gives you confidence and clarity.

If you’re planning to buy in the next 6–12 months, now is the time to prepare. I’ll help you map out your down payment, closing costs, and lender options so there are no surprises on closing day.

📞 Gavin Toor – Mortgage Broker (Volterra Capital Corp.)
📲 604-835-4999 | ✉️ gavintoormortgages@gmail.com
🌐 gavintoormortgages.com

20 Aug

What is a CMHC-Insured Mortgage in Canada

General

Posted by: Gavin Toor

Quick Overview

A CMHC-insured mortgage is a type of home loan in Canada that lets you buy with as little as 5% down. Backed by the Canada Mortgage and Housing Corporation, it protects lenders against default, which often means better mortgage rates for buyers. While it helps first-time buyers enter the market sooner, it comes with strict qualification rules and added insurance premiums.

For many first-time home buyers in Canada, one of the biggest hurdles to owning a home is saving up the down payment. If you’re buying a property with less than 20% down, you’ll likely need a CMHC-insured mortgage. This type of mortgage allows you to purchase with as little as 5% down — but it also comes with strict qualification rules and added insurance costs.

In this article, we’ll break down what a CMHC-insured mortgage is, the pros and cons, and how to know if it’s the right choice for your home purchase.

What is a CMHC-Insured Mortgage?

CMHC stands for the Canada Mortgage and Housing Corporation, one of three national mortgage insurers (alongside Sagen and Canada Guaranty). Mortgage insurance protects the lender if you default on your loan.

Because the lender takes less risk, they’re often willing to offer better mortgage rates. For first-time buyers who don’t yet have a large down payment saved, this can make homeownership much more accessible.

👉 If you’re brand new to the process, I recommend checking out my guide: First-Time Home Buyer Guide: Step-by-Step to Owning Your First Home. It walks you through the full buying journey and pairs well with understanding how CMHC fits into the picture.

Benefits of a CMHC-Insured Mortgage

✅ Lower Down Payments

  • Buy a home with as little as 5% down on the first $500,000, and 10% on the portion between $500,000–$999,999.

  • This makes entering the housing market more realistic for new buyers.

✅ Access to Competitive Rates

  • Since lenders are protected, they often pass on lower interest rates compared to uninsured options.

✅ Get Into the Market Sooner

  • You don’t have to wait years to save 20%. Instead, you can start building equity right away.

✅ Widely Accepted

  • CMHC-backed mortgages are available through all major banks, credit unions, and alternative lenders in Canada.

Drawbacks of a CMHC-Insured Mortgage

❌ Strict Qualification Rules

  • CMHC uses tight debt service ratios: 39% Gross Debt Service (GDS) and 44% Total Debt Service (TDS).

  • This can make approval harder if you have variable income or existing debts.

❌ Mortgage Insurance Premiums

  • The CMHC insurance premium ranges from 2.8% to 4.0% of your mortgage amount, depending on your down payment.

  • The cost is rolled into your mortgage, increasing the total amount you’ll repay.

❌ Purchase Price Limit

  • Only available for homes under $1 million. Anything above requires a 20% down payment.

❌ Owner-Occupied Requirement

  • CMHC-insured mortgages are for owner-occupied properties only. Rental and investment properties don’t qualify.

Is a CMHC-Insured Mortgage Right for You?

For many first-time buyers in Canada, CMHC insurance is the tool that makes buying possible. It allows for a smaller down payment, often with more competitive rates.

However, the strict qualification rules and extra premium cost mean it’s not always the best choice for every buyer. That’s why it’s so important to prepare early.

One of the best steps you can take is to start planning well before your completion date. My post on The 90-Day Pre-Completion Mortgage Checklist explains exactly what to review in the months leading up to closing so you’re not caught off guard.

Final Thoughts

Buying your first home is exciting, but it comes with a learning curve. A CMHC-insured mortgage can be a powerful option if you don’t have 20% down, but understanding the pros and cons is key to making the right decision.

👉 As a licensed mortgage broker, I work with multiple banks and lenders to help first-time buyers find the right fit. If you’re considering a CMHC-insured mortgage, let’s talk about your options.

📞 Call me at 604-835-4999 or visit gavintoormortgages.com to get started.

20 Aug

How Self-Employed Borrowers Can Qualify for a Mortgage

General

Posted by: Gavin Toor

How Self-Employed Borrowers Can Qualify for a Mortgage

By Gavin Toor — Mortgage Broker, Volterra Capital Corp.

Why Getting a Mortgage is Different for Self-Employed Borrowers

If you’re a business owner, freelancer, contractor, or incorporated professional, qualifying for a mortgage can feel more complicated than it is for salaried employees.

While self-employment gives you freedom, it also means your income may not be as straightforward on paper — especially if you use legitimate tax deductions to reduce taxable income.
This can sometimes make it harder to meet traditional lender requirements.

The good news? There are special mortgage programs and alternative solutions designed just for self-employed Canadians.

Common Challenges for Self-Employed Borrowers

  • Lower reported income due to tax write-offs.

  • Irregular income patterns throughout the year.

  • Shorter work history if your business is new.

  • Difficulty proving income with standard documents like T4s and pay stubs.

Mortgage Programs for Self-Employed Borrowers

1. Stated Income Programs

For borrowers who can’t fully verify income through traditional means, stated income mortgages allow you to declare your reasonable annual income based on your business’s performance and industry norms.

  • Lenders assess your stated income alongside your credit history, business stability, and down payment.

  • Often requires a larger down payment (typically 20%+).

2. Dividend Income Qualification

If you pay yourself through dividends instead of salary, some lenders will use this income to qualify you — especially if it’s consistent and supported by corporate financial statements.

  • Dividend income can be grossed-up for qualification purposes.

  • Ideal for incorporated business owners who retain earnings in their company.

3. Gross-Up and Add-Back Policies

Many lenders will “gross up” certain income types or “add back” legitimate business expenses to increase your qualifying income.
Examples include:

  • Vehicle expenses.

  • Home office deductions.

  • Capital cost allowances (CCA).

This can significantly improve your borrowing power.

4. Alternative & B-Lender Solutions

If you don’t fit the exact guidelines of a major bank, alternative lenders can be more flexible with documentation and income verification.

  • May accept bank statements as proof of income.

  • Shorter history of self-employment (as little as 6–12 months).

  • Slightly higher interest rates, but greater approval flexibility.

5. CMHC & Insured Self-Employed Programs

Both CMHC and Sagen offer insured mortgage options for self-employed borrowers who can provide a reasonable income declaration and meet credit requirements.

  • Allows down payments as low as 5% in some cases.

  • Good credit and strong business track record required.

Tips to Improve Mortgage Approval Chances

  1. Keep your business and personal finances separate — clear records make underwriting easier.

  2. File your taxes on time and keep at least 2 years of Notices of Assessment (NOAs).

  3. Maintain strong credit — aim for a score of 680+.

  4. Save for a larger down payment to access more lending options.

  5. Work with a mortgage broker who understands self-employed lending programs.

Why Work With a Mortgage Broker

As a mortgage broker, I work with self-employed clients to:

  • Access specialized self-employed programs like stated income, dividend income, and bank statement mortgages.

  • Compare options from major banks, credit unions, and alternative lenders.

  • Structure your file to highlight your true income and business stability.

📞 Let’s Talk About Your Mortgage Options
Whether you’re an incorporated professional, small business owner, or contractor, I can help you qualify for the mortgage you need — even if your income is unconventional.

Gavin Toor — Mortgage Broker, Volterra Capital Corp.
📱 604-835-4999 | ✉️ gavintoormortgages@gmail.com
🌐 gavintoormortgages.com