In NT, what should I know about self-employed borrowers for car loans?

For self-employed borrowers in NT seeking car loans, demonstrating consistent and verifiable income is paramount, as lenders perceive this income stream as inherently more variable than traditional salaried employment. To qualify, you'll typically need to provide comprehensive financial documentation, including your personal T1 General tax returns and corresponding Notices of Assessment (NOA) from the Canada Revenue Agency for the past two to three years. If incorporated, T2 corporate tax returns and detailed financial statements (income statement, balance sheet) will also be required. Lenders will meticulously review these documents, alongside several months of business bank statements, to establish a stable income pattern after allowable write-offs.

Why this matters: In the Canadian auto finance market, particularly looking towards 2025, lenders are maintaining a cautious approach. The perceived higher risk associated with fluctuating self-employment income often translates into higher interest rates or a requirement for a larger down payment compared to salaried individuals. This is to mitigate the lender's exposure. A strong personal credit history and a clear demonstration of consistent profitability and cash flow are crucial to securing more favourable terms. Being thoroughly prepared with all necessary financial records will streamline the application process and improve your chances of approval, even though the underwriting may be more rigorous.