If a provider is claiming their income for taxation purposes, then they should be able to do all of these things. The government doesn't care where the income is coming from (nor is it illegal to claim income as a provider), so long as it is declared. Then, you have proof of income, and you are able to secure a credit card, loan, etc.
The dark side of hobbying
- Thread starter too2shy
- Start date
Thanks for the input Kathryn, I stand corrected then...I had heard quite the opposite from some SP's in the past (probably not a great sample set). I also should have some "some" instead of "most"...my apologies for generalizing. I think mortgages may be a different matter...since most banks want to see pay stubs from an employer in onder to secure a mortgage (at least they have for me each time I have had to get one). Maybe there are other ways for that also, but in my case it would have been impossible without that data point from my employer.
How does any other self-employed individual secure a mortgage then, without a paystub?
Not an expert... but I would expect self-employed individuals to keep books of business...using something like IntuitBooks or a good ol fashioned paper ledger. I have never heard of an SP keeping books but I will be the first to admit that I know very little of the other side of this industry...I am mostly a client...I expect a bank looking to provide a mortgage would ask to see books of business for anyone self employed.
I am really not trying to pick a fight here...I have heard...anecdotally I might add...that SP's can at times struggle with items that I listed in my first post...If I am completely out to lunch...great...then I am collossaly wrong on this subject. But my point was...if those conditions that I describe are in fact correct (in some cases)...then those are the things that breed a dependent relationship, which can lead to pimps and other forms of dependent relationship.
I am really not trying to pick a fight here...I have heard...anecdotally I might add...that SP's can at times struggle with items that I listed in my first post...If I am completely out to lunch...great...then I am collossaly wrong on this subject. But my point was...if those conditions that I describe are in fact correct (in some cases)...then those are the things that breed a dependent relationship, which can lead to pimps and other forms of dependent relationship.
I am not trying to pick a fight, either. I'm just pointing out that some of us do operate by a self-employment model, where we claim our income and pay taxes, which affords us the ability to secure loans, etc. similar to other self-employed individuals. I do agree that for those who operate off the books, so to speak, that it would be difficult to live in mainstream ways.
Having seen her, her intellect is indeed sexy. But Cat herself is an extremely rare creature that is amazingly sexy in many many ways.
This is exactly true. I have been operating as self employed without any hassles from lenders. And yes, will be paying my taxes this year too.
I just bought (and financed) a brand new car (yay!
), and not a shitty one either. I was a bit worried at first about the financing because even though I have the means to easily make the payments, I had no "paystub" to prove income over the last year. I do deposit all of my cash into bank accounts for safe keeping, so I knew that I had some way to prove that I have regular income, if necessary. I applied for my financing as "self employed" with my estimated annual gross income. Upon the credit check showing a strong credit history, I was not asked to provide any more info or documents, and was easily approved to finance the full amount of the car. Mortgages are obviously a larger thing to deal with, but assuming that one claiming to be self employed is paying taxes and has a good credit history, I don't see how it would be any different from any other self employed individual in any other sector.
Of course there is many reasons for the decriminalization/legalization of prostitution, but for serious SP's who consider themselves as business owners, these kinds of financial issues are not something be concerned about, from what I have seen so far.
As for taxes, the CRA is not a law enforcement agency... They don't care where your money came from, they just want it!
There are products called stated income mortgages, they're way more costly, you basically just say you make X. Only a handful of lenders do this, and it's through the broker or private lenders channel. Other self employed options are providing two years of income documentation, they will want last 2 years of tax returns, and bank deposits. You'll pay a market rate with the latter option. You don't need a 'pay stub' for either.
Also known as "liar loans".
http://www.investopedia.com/terms/l/liar_loan.asp#axzz2JCG9pHBx
Caused a bit of an issue for buyers of mortgage backed securities a couple of years ago...
Yea, but the defaults weren't all as a result of these loans.. moreso that the bottom fell out of the market and many properties were underwater. Forget the negative connotation that you're implying. There are very real use cases for 'stated income' loans, and most of them have nothing to do with being a liar.
I know of a handful of people who've used stated income loans, and in their cases the income stated was actual. One example was a friend who was up from the US, had income in a non-conventional way from a contracting firm and had to get a stated income product. Another had very significant income, but was paid by his company which he owned, in a tax efficient manner. Leaving retained earnings within the company and taking dividend payouts as needed. A further example is someone coming from overseas working on a long term contract here, zero established credit in Canada, but an income 8x the average in Ottawa. His bank in the middle east didn't mortgage properties in Canada, so he took a stated income mortgage through a broker here, and paid it off in full in 2 years.
Life isn't always cut and dry.
