When seeking out a loan, one of the requirements the majority of the lenders will ask for is your recent pay stubs. While this works for many, it does not work for those in self-employment. The process of getting a no proof income loan can be a bit daunting due to the long waits and subjection to more inquiries, than on a person with a W-2 form.
In as much as it is an overwhelming thing to do, getting no proof of income loans self employed is possible. What is even better is the fact that there are numerous companies out there offering some of the best rates in town for such people. So what is the eligibility criteria used? Which are the best companies for no proof of income loans? Find out more here.
Eligibility Criteria to be followed
Even without a monthly paystub, do not worry. There are still hopes of you getting some of the best personal loans with no income verification. All lenders have their eligibility criteria which ought to be followed when applying for a loan. If you cannot meet the requirements, you may include a cosigner to help in getting the loan.
A cosigner is usually somebody who has better qualifications than you do, and you can take up the loan together. Depending on the lender you approached, you may be required to offer collateral as security for the loan.
Part of the eligibility criteria used by many lenders when picking the right candidate for a loan includes;
- Income tax returns filed
The majority of lenders will not approve any loans to someone who has not previously filed for ITR. The minimum such lenders can accept is two years. Your repayment capabilities are gauged based on the monthly income you get.
- Work experience
Your work experience is an important factor considered when applying for a loan. If you have worked for someone, a company, or been self-employed for a rather significant time, the lenders might consider your loan request. This assures them that you will be capable of repaying the loan on time.
- Credit history
In the world of finance, your credit score will always haunt you wherever you go and in whatever you do. Banks will run a credit inquiry on your account to determine whether a loan can be approved for you or not. In the case of self-employment, most lenders, especially banks, will also check the CIBIL score of the individual.
In other cases, they would check the CIBIL score of the firm or company or for other joint owners. You should also consider some of the best ways to get guaranteed loan approval with no credit check if your score is not that impressive to some lenders.
The age factor is yet another very crucial part of getting a loan when you have no proof of income. Most lenders would offer a loan to individuals aged between 25 and 65. In some few cases, one can be eligible for a loan at the age of 23.
The Documents You Need Before Applying for a No Proof of Income Loan
You should, at all times, first, review the eligibility criteria used by the lender to award loans. Check if you qualify and avail some of these, or the entire list of the documents lenders usually ask for;
- Personal Identification – depending on the lender, there are different types of personal Identification you can legally provide. These include your state ID, driver’s license, or passport. You can either copy it and attach to the physical files or scan and fax it over.
- Tax returns – regardless of the lender, you should prepare yourself to show your personal and company tax returns for the last two or so years. This helps in proving the income you declared on your application.
- Financial statements – this is also to help the income you declared. You should document all the profits and losses incurred within a given period.
- Recent bank statements – a bank statement will give a much better, clearer picture for your bank transactions and other savings. Such statements are also used to determine whether you have any outstanding loans or credit cards with other lenders.
How To Choosing The Best Companies To Get a Loan
With so many companies offering no proof of income personal loans, it is good to have a strategy you use in picking the best. Here are a few factors you can consider;
- Interest rates
Ensure that you are aware of the fixed and variable interest rates. Are the interest rates favorable to you, or will they create further financial burdens?
- Turnaround time
Depending on the type of loan you are applying for, make sure that the lender can provide the loan within the allocated time.
Before you apply for a loan, check out the eligibility requirements. Only apply if you have a shot at getting it. Too many applications will render you a high-risk borrower hence risk your applications getting denied.
- The application process
Be in the know of the application process. If you are going to hit a roadblock at any point, you should have measures to counter it in place.
- Collateral required
Always check if any security for the loan is needed. If it is required, you might want to prepare the documents showing ownership of your most valued items.
The 5 Best Personal Loans Companies for Self employed Individuals
Check out this list of the five best companies offering personal loans. All factors have been taken into account when rating these loans.
With a good credit score and the right documents, SoFi can get you low fixed interest rates. With high loan amounts, generous repayment terms, and hidden fees, this is one of the best loans one can take.
2. LOAN away
With a fast and straightforward loan application process, the turnaround time from this company is impressive. You can borrow up to $5,000 without much stress. The payment schedule of up to 36 months is very flexible.
This company offers generous loans to people with fair credit or better. Apart from flexible loan terms and repayment schedules, this company is unique as it allows a cosigner.
Offering low-interest rates to people with good or better credit score, this is a go to loan company for many people. This is attributed to the fact that there are no origination fees charged, favorable repayment terms, and efficient customer support.
If you are looking forward to consolidating a high-interest credit card debt, this is your best shot. Designed to help in paying off credit card debt, these loans have lower rates typically. As much there might be an origination fee for certain loans, there are no other fees you need to worry of. Besides, the generous repayment terms are just some of the best.
The Bottom Line
Depending on your eligibility criteria, your needs, and how soon you want the loan, there are many formats you can use in picking the right loan company. Nothing good comes easy, so be ready to carry extensive research for the best loans. Luck for you, our list of the top 5 best companies offering no proof of income loans self employed is comprehensive, and you don’t need to look further.