If part of your income comes from bonuses or commissions, you are not alone. Many homeowners in Toronto earn a portion of their income this way, whether through sales roles, management positions, or performance-based compensation.

However, when it comes to mortgage approvals, lenders do not treat bonus or commission income the same way they treat a regular salary. As a Toronto mortgage broker, this is a conversation I have often with homeowners who are surprised by how their income is reviewed.

The key factor lenders focus on is not how much you earned in your best year. It is consistency.

Understanding how this type of income is evaluated can help you prepare properly and avoid unnecessary stress during the mortgage process.

Why Lenders View Bonus and Commission Income Differently

From a lender’s perspective, the goal is to assess how reliable your income is over time. Salary income is predictable and stable, which makes it easier to approve.

Bonus and commission income, on the other hand, can fluctuate. Some years are stronger than others, and lenders want to be confident that your income will continue at a sustainable level.

This does not mean your bonus income cannot be used. It simply means lenders apply a different lens when reviewing it.

What Lenders Usually Focus On

1. Income History

The first thing lenders look for is a clear history. Most want to see that your bonus or commission income has been earned consistently over a period of time.

Typically, this means:

• At least two years of bonus or commission income

• Evidence that the income is ongoing, not a one-time event

• Stability in your role or industry

A longer and more consistent track record generally works in your favour.

2. Income Averages

Instead of using your highest earning year, lenders often calculate an average of your past income.

For example, if your bonus income varied over the last two years, they may take the average of those amounts rather than the strongest year. This approach helps lenders assess a realistic and sustainable income level.

This is an important detail many homeowners overlook. Planning ahead can help you set expectations before you apply.

3. Documentation Matters

Clear documentation can make the mortgage process significantly smoother.

Lenders may ask for:

• Notices of assessment

• T4s or T4As

• Employer letters confirming the nature of your income

• Pay statements showing year-to-date earnings

Well-organized records help demonstrate consistency and reduce back-and-forth during underwriting. As a Toronto mortgage broker, I often review these documents with clients in advance to catch any gaps early.

Bonus Income Can Still Be Counted

A common misconception is that bonus or commission income cannot be used at all. That is not true.

In many cases, lenders are happy to include it once they are comfortable with the history, averages, and documentation. The key is understanding how it will be assessed and preparing accordingly.

This is where a bit of planning can make a meaningful difference in your approval outcome.

Why Reviewing Your Income Before Applying Helps

Doing a quick review before you apply for a mortgage or renewal can save a lot of time and stress later.

By reviewing your income structure in advance, you can:

• Understand how much of your income will be counted

• Identify any documentation that may be missing

• Decide on the right timing for your application

A proactive review allows you to move forward with clarity rather than surprises.

How a Toronto Mortgage Broker Can Help

Every lender has slightly different guidelines, and not all of them treat bonus income the same way. Working with a Toronto mortgage broker gives you access to multiple options and a clearer strategy.

Instead of guessing, you get guidance based on how lenders actually assess your income. That insight can make the difference between a smooth approval and a frustrating experience.

Final Thoughts

If part of your income comes from bonuses or commissions, it does not put you at a disadvantage. It simply means lenders want to see consistency and clear documentation.

With a little planning and the right advice, this type of income can absolutely be used.

If you are a current homeowner thinking about refinancing, renewing, or making a change, a quick income review can go a long way. I am always happy to help you walk through your options and make the process easier.