Will a Temporary Loss of Income Impact Your Mortgage Post-COVID-19?

Marci Deane • October 6, 2020

Although it may feel like the impact of COVID-19 is somewhat lessening in Canada and while many Canadians are returning to work, there is no doubt that this pandemic has significantly impacted our economy.


While unemployment peaked over 13% at the onset, it's hard to quantify just how many Canadians had some form of a reduction in their income over the last year. Especially if you're self-employed or your income varies year to year because you receive a bonus, pick up shifts, freelance, or you earn income that isn't guaranteed.



If you earn variable income, and you've seen a reduction in income because of the pandemic, this has the potential to impact how much mortgage you qualify for up to the next three years.


Here's why. For income that isn't guaranteed, when assessing your mortgage application, most of the time, lenders will look at a 2-year average. So let's say you're looking to secure a mortgage now in 2020, the lender will want to see documentation proving what you earned in 2018 and 2019, and they will take a 2-year average.


If your income is lower in 2020 because of the pandemic, once we come to tax time in 2021, your 2-year average will now include that reduction in revenue for the next couple of years, even if you are back to making what you did pre-pandemic. It will be the same case in 2022 (and into 2023), as any lender will want to see your 2-year average between 2020 and 2021. Less income in 2020 could mean qualifying for a lower mortgage amount over the next few years.


The advantage of working with an independent mortgage professional is the ability we have to represent you to several lenders who all offer different products and have different guidelines. So while one lender might be hard and fast on the 2-year average, depending on your industry, another lender might make an exception.


Additionally, depending on where the housing market is at and how much the economy has rebounded in 2021, lenders might consider COVID-19 and be flexible or implement amended guidelines. However, we will have to wait and see on that. But for the most part, if your income is lower because of COVID, it will impact you going forward, feel free to get in touch if you have any questions or hear anything in the news that you'd like clarified.


So what can you do about this today? Well, if you're currently looking to purchase a property or you have a mortgage that's almost up for renewal, or if you'd like to refinance before 2021, it's definitely in your best interest to talk with an independent mortgage professional about all your options as soon as possible.


Alternatively, if you're not looking to secure a mortgage right now, it's always a good idea to have a plan in place for when you do. It never hurts to plan ahead, especially when you have time and can make up some of the lost income with additional income in the future.


If you'd like to discuss your financial situation and see exactly how your income impacts your mortgage qualification, please don't hesitate to contact me anytime, I would love to work through everything with you!


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Smart Strategies to Save for Your Down Payment

By Marci Deane • March 25, 2026
How to Start Saving for a Down Payment (Without Overhauling Your Life) Let’s face it—saving money isn’t always easy. Life is expensive, and setting aside extra cash takes discipline and a clear plan. Whether your goal is to buy your first home or make a move to something new, building up a down payment is one of the biggest financial hurdles. The good news? You don’t have to do it alone—and it might be simpler than you think. Step 1: Know Your Numbers Before you can start saving, you need to know where you stand. That means getting clear on two things: how much money you bring in and how much of it is going out. Figure out your monthly income. Use your net (after-tax) income, not your gross. If you’re self-employed or your income fluctuates, take an average over the last few months. Don’t forget to include occasional income like tax returns, bonuses, or government benefits. Track your spending. Go through your last 2–3 months of bank and credit card statements. List out your regular bills (rent, phone, groceries), then your extras (dining out, subscriptions, impulse buys). You might be surprised where your money’s going. This part isn’t always fun—but it’s empowering. You can’t change what you don’t see. Step 2: Create a Plan That Works for You Once you have the full picture, it’s time to make a plan. The basic formula for saving is simple: Spend less than you earn. Save the difference. But in real life, it’s more about small adjustments than major sacrifices. Cut what doesn’t matter. Cancel unused subscriptions or set a dining-out limit. Automate your savings. Set up a separate “down payment” account and auto-transfer money on payday—even if it’s just $50. Find ways to boost your income. Can you pick up a side job, sell unused stuff, or ask for a raise? Consistency matters more than big chunks. Start small and build momentum. Step 3: Think Bigger Than Just Saving A lot of people assume saving for a down payment is the first—and only—step toward buying a home. But there’s more to it. When you apply for a mortgage, lenders look at: Your income Your debt Your credit score Your down payment That means even while you’re saving, you can (and should) be doing things like: Building your credit score Paying down high-interest debt Gathering documents for pre-approval That’s where we come in. Step 4: Get Advice Early Saving up for a home doesn’t have to be a solo mission. In fact, talking to a mortgage professional early in the process can help you avoid missteps and reach your goal faster. We can: Help you calculate how much you actually need to save Offer tips to strengthen your application while you save Explore alternate down payment options (like gifts or programs for first-time buyers) Build a step-by-step plan to get you mortgage-ready Ready to get serious about buying a home? We’d love to help you build a plan that fits your life—and your goals. Reach out anytime for a no-pressure conversation.

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