A Guide to Personal Loans for Self-Employed Workers
If you are someone who is self-employed and you find yourself in a situation where you need emergency funds, then you might be wondering how you can get a loan for your needs. You know that most personal loans are given to employees of companies since they can prove their source of income with valid papers. You may have a difficult time with documentation if you are self-employed but the good news is that you can actually apply for personal loans even if you are self-employed. Find out how below.
The reality is that you can apply for personal loans even if you are self-employed. You can get an unsecured personal loan whatever your current employment status is. These emergency funds can be used to start a business, to consolidate debts, emergencies and other uses.
One thing that is important though is to verify your income or income source. You may have to provide paperwork for this if you are an independent contractor or a self-employed individual. If you have a strong credit history, then you have more chances of getting approved for a personal loan. But if your credit standing does not look good, then you need to prove a source of income to get a loan.
Some of the documents that you can show your lender is a bank statement or a copy of your tax returns or several years of tax returns. No collateral is needed for unsecured loans and so banks statements are actually not required.
If you are applying for a self-employed personal loan, bank statements are not required. Since these loans are not secured, then you don’t need to provide any type of evidence of your assets, cash flow, etc. If you use a specialty lender for a personal loan for self employed, then you will only need to provide information on the purpose of your loan, your credit score range, your personal information, monthly income amount, your checking account information. This information is required if you will apply in person. Be prepared to email it for online applications.
Two years of tax returns might be required for a self-employed personal loan. You can provide less documentation if you have a good credit score or if you have a spouse who is employed.
You may also need to submit a statement of profit or loss from your business. This document is actually filed on your business tax returns. This is called the schedule C. this helps a lender know how much amount of cash flow your business generates after expenses.
You can also apply for a personal loan self employed without financial document if you have an acceptable DTI ratio and a high credit score.
It is not impossible to get a self-employed personal loan. Just follow the tips above and you will soon have funds for your emergency needs. For more information about personal loans, click on this link: https://simple.wikipedia.org/wiki/Loan.