Self-employed and freelancers often need a lot of patience when borrowing. Many banks do not offer loans for this professional group. The reason is the high risks. The self-employed usually have little security. You have no fixed monthly earnings.
This has a negative impact on creditworthiness and therefore disadvantageous on interest rates. A cheap loan for the self-employed is therefore not easy to find. Nevertheless, there is now funding that is recommended for freelancers, entrepreneurs and traders. This includes, for example, some online loans. More and more direct banks have now discovered this target group for themselves. A cheap loan for the self-employed is not only characterized by its interest rates. Also important are the repayment portion, the available loan amount, any applicable fees and the term.
Many banks offer the self-employed and freelancers interest on loans of around ten percent. There are now also cheaper offers. For example, some direct banks rely on effective interest rates of around seven percent. In order to take advantage of a cheap loan for the self-employed, various documents must be submitted when applying. A salary statement in the strict sense is of course not available at this point.
Nevertheless, the self-employed can also make certain preparations. In order to be able to make a credit decision, banks in turn rely on material. BWA is often required. This is a business management analysis. It is usually prepared monthly by tax consultants and accountants and provides information about the company’s profits.
A cheap loan for the self-employed is only granted by banks if appropriate collateral is available. This can be the income tax notice from last year. It can be used to filter out what income the applicant has. In addition to a current BWA, the results of the last annual financial statements are also important. For some banks, income-surplus bills are sufficient. Proper accounting can have a positive impact on the credit decision.
It is important that it generates regular payments. The banks’ caution with the self-employed is not unfounded. Statistics show that loan defaults occur more frequently in this occupational group than among employees or even civil servants. Many banks require guarantors from the self-employed. Alternatively, co-applicants are sufficient. If both are not available, as many collateral as possible often remains.
These can be real estate, real estate, but also existing life insurance. Many banks also accept securities as a hedge. There are now alternatives to the classic bank loan for the self-employed. They are private loans that are offered on brokerage platforms.