If you want to take out a loan, you must first of all specify what the money is needed for. Subsequently, the bank will decide whether it is a small loan, a car loan or a real estate loan. However, when borrowing, there is another distinction: does a home buyer apply for the loan or a self-employed person? For a private customer, monthly income is used for lending and debt service calculation. As a self-employed, however, you have to submit other figures and the credit decision by the bank is usually tedious, making the loan for self-employed is a bit more complicated.
In addition, there are in fact a number of banks or lenders, which simply do not impart to self-employed persons because they are too risky.
Provider for self-employed loans
A big provider, which is currently more and more established in the market Iwoca. This lender specializes in providing loans to entrepreneurs, small business owners and the self-employed. The online loan for the self-employed is uncomplicated and transparent.
There are providers who know about the difficult situation of self-employed people when it comes to applying for loans. Especially the Targobank attracts attention by appealing to the self-employed. Here you have a good chance of a loan on reasonable terms.
As a self-employed apply for a loan
First, when borrowing, a self-employed person must be distinguished, whether it is a loan for a private purchase or an acquisition for self-employment. For example, if the entrepreneur needs a new car for private use, the economic situation of the company can usually be left out.
However, if a car is purchased for operation, or if a new machine needs to be funded for the business, then the company’s economic figures are crucial for lending. Both the balance sheet and the income statement or a current tax assessment must be submitted for this review. Based on this evaluation, it then comes to a cancellation.
Credit for freelancers
Since self-employed and freelancers often do not have a secured income in the sense that this varies, for example, depending on the order situation, it is often more difficult for this professional group to get a loan than for other professions. Here we clarify what conditions must be met in order to still get a loan for freelancers.
Requirements for a loan for freelancers / Self-employment loan
The fact that the risk of default on loans is higher for freelancers due to cyclical fluctuations, for example, often does not suffice to provide proof of income. Instead, there are a number of other claims that potential lenders make to the claimant. Most common are these:
- Self-employment has existed for at least two, better three years and there are other collateral, such as assets (real estate)
- Of course, as with other borrowers, the Private credit Score should be as positive as possible
- The freelancer must also prove that-and what income has been earned in the past months. Normally, the last three bank statements are required, from which the bank then calculates an average income
- In addition, a number of other documents can be requested, such as a business evaluation (BWA), income / surplus calculation or profit and loss account or income tax assessment
However, these are just the “official” points. Also, the individual life situation is crucial, it makes a big difference if a self-employed management consultant with his family lives in the same house for years and thus in a “stable” life situation or if someone travels as a freelance photographer around the world.
Provider loan for freelancers
However, the overall situation has improved a little, with companies increasingly specializing in the market for freelance credit. An example of this is Iwoca, which virtually exclusively lends out loans to founders and self-employed.
An important alternative now offer P2P platforms such as moneyor. Here, the loans are given from private to private, so here everyone has the chance to get a loan.
Credit for entrepreneurs
A start up loan is, for obvious reasons, a particularly big challenge : no previous profits can be proven and there can be no assurance that profits will be made in the near future.
For this reason, one often has to look for specialized providers and funding programs here.
Requirements for a loan for entrepreneurs
To get a start-up loan there is usually one requirement above everything else: the business plan. The vision for the business can be as great as it pleases – if there’s no solid business plan behind it, no lender will risk it. What must a good business plan contain?
- First, there are no formal compulsory parts that a business plan must contain in any case. But there are components that count as standard
- A summary, so the most important points briefly formulated
- Corporate goals and a company profile
- Presentation of the business or product idea and what it brings to the customer
- In which industry / market would you be active?
- marketing strategy
- What is the practical implementation of the idea?
- Business organization / management and key positions
- A representation of the strengths and risks of the company
- Financial planning: determination of capital requirements and liquidity planning
Provider credit for entrepreneurs
As with freelancers, a relatively new alternative is P2P platforms, where private investors lend out loans. If you can convince yourself here, you can also get a loan.
Specializing in credit for existence founders and companies is also specializing in the platform Funding Circle. Again, this is an online loan for the self-employed
Loan for Self-employed Requirements – Collateral
As with almost all loans, a collateral must also be deposited in the case of a loan application by an entrepreneur. If the borrowing is private, then the cession of a life insurance or the conclusion of a residual credit insurance is sufficient. However, a self-employed loan for a business acquisition requires other collateral to be deposited.
For example, assignments of receivables may be required by the bank or even a mortgage on the business property. In the case of assignment of claims, the bank receives the right to receive funds from unpaid claims on customers. A mortgage can be made if the property is owned by the self-employed person. When purchasing a car or a machine, it is also possible to make a security transfer agreement. This means that the purchase can be used by the company, but remains the property of the bank until full payment. If the installment repayment is not complied with, the bank has the option to sell the item.
Do not be afraid of borrowing as a self-employed person
Of course, every bank knows that a company can only work if it invests in it. Therefore, self-employed should not shy away from a loan request. Simply fill out the loan request online quickly so that the bank can check the key data. For an exact credit decision it always comes to a personal contact, so that the lending for both sides can go quickly on the stage.