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Personal Loan For Self Employed: Everything You Should Know

Did you know more than 50 percent of India’s population is self-employed? And since lenders are not very fond of risk, it is difficult for a self-employed individual to get approval for personal loans easily. One of the main reasons for this is the fluctuating flow of income. So, how can you get a personal loan for self-employed?

You can! In here, learn everything about a self-employed personal loan.

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What Is The Personal Loan Eligibility for Self-Employed?

Being self-employed has its own set of pros and cons; flexibility in time but the source of income is not fixed. When a lender is approving a personal loan, he/she must be sure that you are eligible to repay the loan. This is why the personal loan eligibility for a self-employed individual is different from a salaried individual.

The personal loan eligibility for self-employed individuals are as follows:

Please note the eligibility could vary from lender to lender basis.

How To Qualify For A Personal Loan – Factors to Consider When Applying For Personal Loan

We all want to get approvals as quickly as possible. However, this is not always the case. When you apply for a personal loan, it is important to consider some factors for easy approval.

Here are a few questions to ask yourself to see whether you qualify for a personal loan:

• How well are your finances?

The best way to better your chances for personal loan approval is by being organized and diligent with your finances. Since a self-employed might have fluctuating income, it is best to confirm with lenders what can be considered as alternative forms of earnings. This could be your rent, investments, and others. Also, make sure you have all the documents related to your tax returns in order to support your application in a better way.

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• Are you safe from contingencies?

None of us know what holds for us in the future. This is why preparing for contingencies is important. For instance, how can you repay your loan if suddenly you start incurring a loss from your business? Just like you, the lender wants to be assured about his/her money. One of the easy ways to give that assurance is by showing some proof of your savings.

• Do you have all the documents to prove your income?

The only difference for a self-employed individual from a salaried individual is the flow of income. Therefore, the lenders would want to know that your business is stable and you can repay the loan within the stipulated time period. For this, you would be required to give the relevant documents that prove the same.

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What Are The Documents Required for Self-Employed? Best Personal Loan Interest Rates in India

Although most of the documents required to validate the information provided by you are common, there are some more documents required for self-employed individuals. Best Personal Loan Interest Rates in India

The documents required for self-employed individuals to apply for an easy personal loan online are:

→ Identity & Age Proof

→ Completely filled personal loan application with photograph

→ PAN Card

→ Residence proof – Passport driving license, Voter ID, postpaid/landline bill, utility bills (electricity/water/gas)

→ Bank statements for the last 3 months(preferably your salary account)

→ Salary Slips of last 3 months

→ Last 3 years Income Tax Returns with the computation of income

→ Last 3 years CA Certified / Audited Balance Sheet and Profit & Loss Account

Best Personal Loans for Self-Employed In 2019

Now that you know the personal loan eligibility, documents required and the factors that need to consider when applying for a loan, here are the best personal loans for self-employed in 2019:

*The figures provided in the table are indicative subject to change from time.

So, there you go! Here is everything you should know about a self-employed personal loan. If you have any more questions related to personal loans for self-employed, comment below and our financial experts will give you the right guidance.

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