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Credit For Self Employed
Everything can be a bit harder when you are self employed. You work longer hours, have more responsibility, more stress and it can be harder to secure credit. At Loan Monkey, we can not help you with the first few things but we may be able to help you secure a fast loan quote.
We are not direct lenders and you should be happy about that. Instead, we get you access to a large network of independent lenders. More lenders means that it may be easier to secure a monthly installment loan offer, even with bad credit. In any case, getting a quote is free so there is no risk to you. Here is how the quote process works if you need loans for self employed with bad credit.
First, you will need to obviously fill out the short quote form at the top of this page. It will take just a few minutes and will only ask for some very basic information. This is not going to be a home mortgage type of application. Once you fill out the simple form, agree to thee terms and hit submit.
After hitting submit, your information will be securely sent to the loan network. It will go from lender to lender until one is found that wants to make you an offer. If a lender is found, you will be directed to their website or you will be sent all of the loan details. Review them thoroughly.
Should you decide to accept your offer, you can get the money as soon as the next business day. If you turn the offer down, there is no commitment, just walk away. Ii is as simple as that.
The Challenge of Getting Credit
At Loan Monkey, we understand the challenges faced by the self employed. Everything is often harder to qualify for and the paperwork requirements can be greater as well.
The chief problem is that lenders need to see that you make enough money and that you get that money on a regular basis.
A W2 employee has it easy. They can simply show a lender a few pay stubs and that is it. The self employed have a harder time because they do not always draw a regular paycheck. Lenders will often ask for several years of tax returns to prove that income really is coming in on a regular basis. This can lead to another problem that self employed have.
Income does not always show up on a ta return. This is because so many expenses can be written off. These write offs can drastically reduce the adjusted income.
Overcoming Credit Challenges
Every lender is different with how they deal with the self employed. Some are more eager than others to work with you. This is why dealing with a lender network is important. It gives you more chances to find a lender that will work with self employment income, even with bad credit.
Some lenders, for example, may be able to look at bank records to see income. This can allow a borrower to show a higher income than a tax statement would. It might also help a borrower deal with short term self employment totaling less than two years
In any case, there are a number of ways that lenders may be able to handle your particular situation.
Deciding On A Loan
Loans are never something that should be used without careful consideration. Even if you need money today, take a few minutes to consider everything. You should first take a look at all of the details to see if the cost of credit is worthwhile and if you have any better options. Never blindly accept a loan, even if you are self employed with bad credit.
First, take a good look at the cost of the credit. This is how much you would pay if you carry your loan to term. Whether the cost of credit is worth it to you might depend greatly on what the loan is for. If it for a necessity that you can not do without, you might be able to accept a higher cost of credit. If the loan is for a luxury item, you should probably not accept too high of a cost.
Next, you should look at whether or not you have any other loan alternatives. Can you borrow from a family member or perhaps a colleague? If the loan is for business purposes, perhaps taking on an investor might be a good idea.
There also may be ways to get the money that do not involve a loan at all. A part time job could allow you to earn the money if you have the time to wait on it. You could also sell something on Craigslist or eBay. Every free alternative should be pursued before a loan because, well, they are free. Even if you can not get all of the money you need, it may be worth the effort. Earn just 500 dollars and that is 500 dollars that you will not be paying interest on.
Last of all, you should decide if you really need the loan at all. If you can do without the money or would be fine waiting, you should do so. Only take a loan out if it is truly needed, especially with bad credit. Bad credit financing will always cost you more and waiting could allow you the time you need to improve your credit. Simply paying your bills on time and lowering your credit utilization a bit could turn your bad credit into fair credit and then your options will be much improved.
