When applying for a mortgage in Ontario, Canada, lenders typically require a Letter of Employment to verify your income stability and employment status. This document is crucial for assessing your ability to meet mortgage obligations. A comprehensive Letter of Employment should include the following details:
1. Company Information:
○ Official company letterhead, including the company's name, address, and contact
information.
○ Date the letter was issued.
2. Employee Details:
○ Your full legal name.
○ Your job title or position within the company.
○ Employment status (e.g., full-time, part-time, contract, temporary).
○ Start date of employment.
○ If applicable, confirmation of the completion of any probationary period.
3. Income Information:
○ Your current salary or hourly wage.
○ For hourly employees, the number of guaranteed hours per week.
○ Details of any additional compensation, such as bonuses, overtime, or
commissions, if these are regular and consistent.
○ Frequency of pay (e.g., weekly, bi-weekly, monthly).
4. Employer Confirmation:
○ A statement confirming that the information provided is accurate.
○ The employer's assurance of the employee's good standing.
5. Employer's Contact Information:
○ Name and title of the person signing the letter.
○ Direct contact details (phone number and email address) for verification
purposes.
6. Signature:
○ The handwritten or digital signature of the employer or authorized representative.
Additional Considerations:
● Currency and Validity: Lenders typically require that the Letter of Employment be dated
within 60 days of your mortgage application to ensure the information reflects your
current employment status.
Loans Canada
● Consistency: Ensure that the details in the letter align with other documents you
provide, such as pay stubs and tax returns, to avoid discrepancies that could delay the
approval process.
● Self-Employed Applicants: If you are self-employed, traditional Letters of Employment
may not apply. Instead, lenders may request:
○ Notices of Assessment from the Canada Revenue Agency (CRA) for the past two
to three years.○ Financial statements of your business.
○ Proof of business ownership, such as articles of incorporation or business
licenses.
○ Bank statements showing business income deposits.
Sample Letter of Employment:
● [Your Company's Letterhead] *
[Date]
[Your Name] [Your Address] [City, Province, Postal Code]
To Whom It May Concern,
This letter is to confirm that [Employee's Full Name] has been employed with [Company's Name] since [Start Date] as a [Job Title]. [He/She/They] is/are currently employed on a [full-time/part-time/contract] basis, working [number of hours] hours per week.
[Employee's Full Name] earns a [annual salary/hourly wage] of [amount] [currency], with a pay frequency of [weekly/bi-weekly/monthly]. Additionally, [he/she/they] [receives/do not receive] regular bonuses, overtime, or commissions amounting to [amount], which [are/are not] guaranteed.
Should you require any further information, please do not hesitate to contact me at [Employer's Phone Number] or [Employer's Email Address].
Sincerely,
[Employer's Signature] [Employer's Name] [Employer's Title] [Company's Name] [Company's Address] [City, Province, Postal Code]
Providing a detailed and accurate Letter of Employment that includes all the necessary information can significantly enhance your mortgage application process by giving lenders confidence in your financial stability.