How do i get a loan as a self-employed person??

Self-employed people usually don't have an easy time getting a loan. The reason is, lenders want their money back along with interest in a certain amount of time. To achieve this goal, they require a guarantee in the form of the borrower's creditworthiness. This includes a positive credit report, a regular income, a guarantee or other security.

Self-employed persons and other groups of persons such as freelancers and students do not have a regular income, which means that they are generally not considered creditworthy by banks. A large, unplanned risk for the self-employed is also hidden in an unexpected drop in orders or outstanding receivables. Factors that are usually not assessable or influenceable. Many reasons why credit institutions have difficulties with a loan for the self-employed.

Where do self-employed people get a loan?

Despite the lower creditworthiness offer self-employed credit offers. This is particularly true of direct banks and internet lending platforms such as auxmoney. Direct banks employ fewer employees than banks, which is why they save costs. They often pass the savings on to customers in the form of favorable interest rates and terms.

For the self-employed, the probability of getting a loan basically increases if they are able to provide the following:

– additional collateral
– find another borrower to include in the contract
– error-free and detailed information when applying for a job

If you are self-employed and offer the bank additional security such as real estate or life insurance, you increase your chances of getting a loan. The same applies if he includes a second borrower in the contract. The bank calculates the income of both borrowers together, which increases the probability of repayment. This means that the chance of winning the bid increases. Furthermore, the bank often rewards the borrower with more favorable interest rates. All this is subject to the condition that the second borrower has both a minimum income and no negative entry in schufa. The ideal case is to have a permanent employment contract.

Another way for self-employed people to increase their chances of getting a loan is to provide error-free information when applying for it. Here it does not matter whether they refer to information about the salary, the second borrower or other income such as rent. The same applies to existing loans. The reason is, only by correct information a correct evaluation basis can be provided. Accordingly, lenders, especially banks, attach great importance to the accuracy of the information provided.

Loans from private investors for self-employed people

At auxmoney, private investors decide whether or not to grant a loan to the self-employed. The advantage for the self-employed here is that a desired loan amount is financed by various private investors, not the bank. The whole thing works without submitting a lot of documents.

The self-employed person who wants a loan is best to present in detail both project, profits, sales and costs, so that potential private investors can see at a glance whether he is able to afford a loan or not. The most convincing way to gain the trust of private lenders and obtain a loan as a self-employed person is a business plan.

Microcredit for the self-employed

One way for the self-employed to overcome a short-term financial gap is to take out a so-called microloan. This is a restricted loan with usually a maximum loan amount of 10000 euros. A microloan can be requested from microfinance institutions, which are available to advise the inquirer. The advantages and disadvantages of microloans for the self-employed are:

– fast processing and disbursement
– free processing
– alternative fundraising method for the self-employed
– especially suitable for start-ups
– fewer conditions for the credit approval (schufaauskunft, own capital funds)
– co-financing with banks is within the realm of possibility
– no industry exclusion
– free unscheduled repayments are allowed
– if successfully settled and repaid, regular claiming allowed

Be wary of dubious providers of microloans. These usually try to get rid of other products at the same time