Mortgage for Artists in Canada | What You Need to Know
February 23, 2023 | Posted by: Ron Chan
Thanks to the efforts of the Winnipeg Arts Council, patrons, supporters, and professional artists such as yourself, the arts and culture scene is thriving in the greater Winnipeg area. This has allowed a nimbler of creative people to follow their passions, instead of being stuck in a cubicle from 9 to 5 and wasting their potential. That being said, you’re not without concern in following your dream. Some close-minded individuals and institutions do not consider your profession in the same manner as they do for finance, law, engineering, and even trades.You may be afraid that these same individuals work behind the loan-officer desks of Canada’s big banks. As a result, you may have hesitated to get pre-approved on a mortgage, much less go home-hunting. Thankfully you’ve decided to perform an online search for “mortgage for artists” which has delivered you here. And we’re here to tell you that getting a mortgage is most certainly within reach. Below is everything you need to know.
4 Things to Consider as an Artist Getting a Mortgage in Winnipeg Manitoba
I. Are You Self-Employed?
If you're under the employ of a gallery or organization that has an arts department (university, marketing company, etc.) then the mortgage process is straight forward. Prior to getting pre-approved you will simply want to gather documentation regarding employment status (length of tenure and annual income) and your credit history. However, many artists are classified as contractors or may be outright self-employed. If so, please reference our guide to getting a mortgage as a self-employed person. Alternatively, Winnipeg area artists can give us a call at 204.290.9950 and we'll walk you through the process.
II. Reporting Other Sources of Income
Many artists have other sources of income. It certainly doesn't hurt to have backup income potential in play to account for fluctuations in patron interest. But when it comes to getting a mortgage, you may not know how varying sources of income can or should be reported when applying for a home loan. Click the link below for an easy-to-follow breakdown of what you need to count as income:
III. Alternative Lenders an Option
Remember those close-minded individuals that we mentioned in the introduction? It’s true that some of them work at Canada’s big banks. While great strides have been made in how the arts are viewed in the professional landscape in Canada, it’s good to have options should you come across roadblocks. When you work with a mortgage brokers, those options increase exponentially. Not only does a professional broker have connections at Canada’s big banks, they can also connect you to alternative private lenders who look at the big picture of you as an investment. A few of them are even patrons of the arts! Winnipeg area artists can give us a call at 204.290.9950 for help in approaching banks and alternative lenders.
IV. Factor Home-Studio Write-Offs into Your Annual Mortgage Expense
Worried about what you can afford considering the state of variable and fixed mortgage rates? Remember, as an artist getting a mortgage is not just about buying a home to call your own. It’s also an investment in your vocation. Whether you sell your work independently, through a gallery, or you work for an organization you can absolutely write-off a significant portion of your mortgage. When you work from your home studio, mortgage proceeds are effectively used/invested to generate income. As a result, the interest portion of your mortgage payment is eligible for a tax deduction. In addition, you can deduct homeownership-related expenses such as utilities, insurance (mortgage, home, and business), maintenance, property taxes, and more. The more you depend upon your new home as a studio, the more you can apply for the maximum allowable expense deduction. Consider this when getting a mortgage, as you may want to buy a home with an extra room for your in-house gallery!
When you spread these tax reductions over the annum and “apply it” to your monthly mortgage expenditure, you can absolutely save money over the long haul. Call us (below) to learn more.
GET A MORTGAGE AS AN ARTIST IN WINNIPEG WITH RON CHAN: