Let Us Answer All of Your Questions
What are Loans for Self-employed Workers?
Self employed loans are personal loans that are tailored for individuals who work for themselves, either as a freelancer, or as an owner of a business, alternatively to working for an employer.
Why is it Difficult to Get Self-employed Loans UK?
It can often be difficult to obtain a personal loan for self-employed as the majority of lenders have tightened up on their criteria. They now tend to ask that you provide clear evidence of your income so they can make necessary assessments on the affordability of your loan and your individual financial position. However, when you are self-employed, you may not have a clear or regular income as it may have come from multiple different sources, and therefore, proving difficult to quantify. However, this is not the case for all lenders. Here at iThink Finance, we are happy to accommodate to our customers’ needs and help you find the best deal on your loan, regardless if you are employed or self-employed.
How Do Our Loans Work? How Do Personal Loans For Self-employed People Work?
If you are self-employed, then you may have found it more difficult applying for a loan when it comes to proving your income. Here at iThink Finance, we want you to feel unrestricted and free to receive the funds to realise your financial ambitions. That is why we have made the application process for self employed loans uk quick, easy, and simple.
1. Choose Your Loan Amount & Term
We offer loans for all purposes to suit each individuals unique circumstances. This is why we have loans from £1,000-£20,000 and with repayment terms of 12-72 months. Simply choose how much you'd like to borrow and for how long and continue onto the next step.
2. Provide Some Extra Details
We will need to collect a few details from you so that we can verify your identity and send you important information regarding your loan. These details will include the following.
• Purpose of your loan
• First and last name
• Date of birth
• Marital status
• Number of dependants
• Email address
• Mobile phone number
Lenders will need some proof of income to make sure that you are able to make the necessary monthly repayments on the loan. The type of proof required will depend on the lender, but some will ask you to provide up to 3 years proof. So, be prepared to show bank or business statements recording this.
3. Get An Instant Decision
We will now search a panel of the top UK lenders and get back to you with an instant decision on your loan. You should be notified within seconds of applying whether you have accepted or not.
4. Receive Your Loan
Most lenders will be able to transfer the funds directly into your account within only 24 hours!
5. Repay Your Loan
Oncce you have received the requested funds, you will repay the balance in affordable monthly installments that were agreed between you and the lender.
|Annual Interest Rate||150% pa (Fixed)|
|Total Amount of Credit||£850|
|Loan Duration||11 Months|
|Total Amount Repayable||£1,609,25|
|Total Charge of Credit||£759.25|
|Monthly Repayment Amount||£146.30|
Example Uses of Loans for Self-employed Workers Uses of Self-employed Loans UK
One’s reason to take out a loan can vary from person to person. Luckily, our personal loans can be used for a range of different purposes, so we can tailor to each and every one of our customers’ needs. So, whether you are looking to buy a car, plan your wedding, pay off some bills, or expand your business, we have faith in our ability to find the right loan for you.
1. Car Finance
Have you been going back and forth trying to decide whether you should buy that dream car of yours, or are just simply in need of a new motor? With a personal loan for self-employed from iThink Finance, you don’t have to waste time deciding. If you don’t have enough money to pay for your car upfront, then personal loans for self-employed are the cheapest way to borrow money over the long term. You can apply online with our quick and easy form today and can even receive the money into your account the same day!
2. Home Improvement Costs
Loans for home improvement can really help add value to your home. Home improvement plans consist of anything from kitchen upgrades and loft conversions to building a conservatory, and painting jobs. So whatever purpose you are looking to take out a personal loan for self-employed for, we got you covered!
3. Cosmetic Surgery
People receive cosmetic surgery for various different reasons, whether it’s for aesthetic or health purposes. But either way, it can be fairly costly. We want our customers to feel unrestricted on their cosmetic surgery journey, which is why we have made getting a loan while self-employed easy and simple. So, if you want funding support towards your cosmetic financial scheme or to pay for the whole procedure, we’re happy to help.
4. Business Expenses
If you are self-employed and have your own business, you may be be looking to receive a personal loan for self-employed to cover business expenses or expand and grow your company. In this case, we provide loans from up to £20,000, and offer a quick, simple, and low-cost way to support your business.
5. Debt Consolidation
Getting a loan while self employed is difficult. So, looking to consolidate your debt whilst self-employed can be an even more tiresome task. But fret not, iThink Finance makes it uncomplicated and easy. Debt consolidation loans are a great way to downsize your debt. Read More »
They function by taking your multiple debts and merging it into one primary, and more manageable source. This makes your debt a lot more affordable, easier to manage, and reduces the risk of forgetting about your repayments.« Show Less
6. Wedding Costs
Your wedding day is a day that you are going to remember for the rest of your life, so it is important that you do it properly, and in exactly the way that you imagine. However, sometimes it is hard to transfer the dream image of your wedding and make it a reality. We believe everyone should have the right to celebrate their wedding in style, which is why we provide loans for weddings and any costs involved in that.
How To Get Loans For Self Employed With Bad Credit How To Get Loans For Self Employed With Bad Credit
It can be difficult receiving any type of credit when you are self-employed, let alone if you have poor credit. However, there are still things that you can do to increase your chances of being accepted for self employed loans uk. However, because we are a broker, we work with a panel of the top UK lenders so you are more likely to get accepted for a loan, even with bad credit.
Improve And Protect Your Credit
Personal loans for self-employed individuals can be difficult to obtain, which is why it is so essential that you continue to not only protect, but also improve your credit rating to increase your chances. Read More »
It is important to remember that there are several different things that can affect your credit score, all of which indicate how well you manage your finances. To keep on top of your finances, you should keep the following things in mind.« Show Less
1. Avoid Applying For Too Much Credit At One Time
A lot of people don’t realise how this can affect their credit score. When you apply for credit, you will have to go through a credit check and new applications for credit count for 10% of your credit score. Therefore, if you are making several different applications for credit, your score could not only drop significantly but a lender is more likely to decline your application if they see that you have made several applications.
2. Get Rid Of Existing Debt
Having debt lying around is never good. You should always aim to pay off any debt that you owe before you make another application. Lenders will always see it as a good sign if you possess less debt than you want to borrow.
3. Correct Any Errors On Your Report
There may be things noted on your credit report that shouldn’t be there. It is very important that you keep an eye on your report so that you can avoid anything from affecting your credit score. To check for any errors, click here.
4. Make Sure You Are Registered On The Electoral Roll
Lenders will use the electoral register to verify your identity and your residence, so it is important to register on the electoral roll with your current address to make their job easier and to avoid any hassle.
5. Pay your Bills on Time
Paying your bills on time is a great indicator to the lender that you can stick to payments and will have no trouble repaying your loan. if you are missing payments then the lender may issue a default and close your account. You want to avoid this as it may cause negative repercussions on your credit rating for up to 6 years.
6. Set up Direct Debits When You Can
Missed payments are never good for your credit score. To avoid missing payments or paying your bills, aim to set up direct debt payments so that you don’t have to worry about this happening.
How Do I Get Self-employed Loans UK? 5 Top Tips on Getting Loans for Self-employed Workers
As mentioned previously, getting a loan while self-employed can be difficult. This is why it’s important to follow some important pieces of advice to ensure that you have the best chance of being accepted for your loan.
1. Be honest with your lender
If you are self-employed, your income may not be consistent. It is extremely important, therefore, that you are honest with your lender, particularly in regard to your income and your financial situation. This way, your lender can make necessary affordability assessments on your loan and you can agree on a monthly installment period that works for you both. This reduces the risk of any problems rising in the future.
2. Improve your credit score
It is crucial that you maintain a good credit score to receive any loan, but especially if you want to receive a personal loan for self-employed. To do this, you should ensure that you are paying bills on time, repaying any previous debts, regularly checking for any mistakes on your credit report, and registering on the electoral roll if you haven’t already. To check your credit score visit Equifax or Experian.
3. Repay any previous debt
Possessing a large amount of uncollected debt can be a bad indicator to lenders, so you should aim to pay off as much of your previous debt as possible before you take out a new loan. It is a lot easier said than done though, so consider the following tips when doing so:
Set a budget and cut back on unnecessary expenditure.
Pay off your debt with the higher interest rates first so you are not accruing more interest than you need to.
Ensure that you are paying off at least the minimum repayments each month.
Consider debt consolidation loans or balance transfer credit cards.
4. Keep informed about your finances
To ensure that your application progression is positive, you should aim to stay organised and informed with your financial records and documents. You should also make sure that your tax returns are precise, current, and fully paid. Read More »
Because you are self-employed it is likely that the lender will want to know more information than someone who is employed. So, you should also expect to answer some questions regarding your financial obligations and spending practices, and also provide comprehensive reports of your income.« Show Less
5. Research different lenders' criteria
As previously mentioned, being self-employed may mean that your income is inconsistent and may come from different sources. Consequently, you should do some research to find out what criteria lenders use to assess their self-employed customers. Some lenders might accept proof of your earnings in different forms such as rent or investment bills whilst others may not. Also, some lenders may ask from 6 months’ proof of income, whilst others may ask for up to 3 years proof.
You should aim to look for the following things when considering a lender: Read More »
- That the lender accepts alternative records for loan approval.
- That the lender promotes flexible repayment periods.
- That the lender proposes fixed or variable interest rates on their personal loans for self-employed.« Show Less
Frequently Asked Questions FAQ's
Getting a loan while self-employed can be tricky and confusing, so you must have accumulated a whole list of questions. And if we haven’t answered it already, take a look at the most frequently asked questions regarding self-employed loans UK below, as you may find the answer you’ve been looking for.
Who can apply for loans for self-employed?
To receive self-employed loans UK, you should meet the following criteria:
You should be a UK resident.
You should be over the age of 18.
You must own a UK bank account.
I need help getting a loan while self-employed. Can I receive self-employed loans with bad credit?
Whilst receiving a personal loan with bad credit can prove difficult, there may be lenders who would still accept you. However, to increase the likelihood of being accepted you should take some necessary steps to improve your credit. For example, you can do this by paying bills on time, reducing previous debts, and avoid applying to several loan applications with a hard check at one time.
What information do I need at hand to apply for self-employed loans UK?
Self-employed individuals have more complex incomes and therefore will need to provide different types of proof of income compared to employed customers. The lender will need to assess how much you are earning and if your earnings prove that you will be able to manage your loan. To make this assessment, the lender will most likely want to see the income that you have reported to HMRC, as well as your tax paid. It is also likely that they insist that you provide 2-3 years of accounts prepared by a certified accountant, however, this does vary from lender to lender.
Is it hard to get a personal loan for self-employed?
Whilst individuals who are employed and self-employed can access the same rates, the process application will vary, and it is likely to prove slightly more difficult for those who are self-employed. Some lenders may be more hesitant to take on self-employed individuals as they may feel that you pose more of a risk. Therefore, to ensure that you get a fair trial, it is important that you gather all relevant documentation that proves you pose small risk and have good financial management. For example, 2-3 years of accounts prepared by a certified accountant is documentation that the lender would like to see.
Do all personal loans require proof of income?
Yes. When applying for loans for self-employed , you will require proof of income. Proof of income is important as it is the lenders way of confirming the borrowers ability to repay their debts.
Can I use self-employed loans UK for debt consolidation?
Indeed you can. If your debt load is becoming unmanageable, a personal loan for self-employed workers can help you consolidate your debts and merge into one primary, more affordable, source.