We recently funded a mortgage for a client of ours, for $1.84M. The client has a good equity position in their home and wanted to refinance their property.
The clients business slows down over the holidays and early part of the winter and and wanted to firm up their payment in a short term fixed mortgage and get out of their variable rate mortgage. In addition, there was unsecured debt with rate that kept increasing due to the BoC rate increases. It makes a lot of sense in this case to consolidate that debt into the mortgage so they can fix the payment and reduce the overall cost.
Personal income filed almost covered the debt servicing but not exactly where the lenders needed it to be. We are able to lean on the clients net income after tax from their business financials to support/top up their personal income to obtain the approval.
This mortgage is a huge success for the client. They file the income that makes sense on their personal tax return while leaving capital in the corp which is tax advantageous. We moved them from a variable mortgage to fixed to tighten up cash flow while business slows down and removed higher costing debt to lower costing debt all while reducing the monthly debt obligations.