A personal loan is an unsecured loan given not only to salaried professionals but also to self-employed individuals. A self-employed personal loan is suitable for both personal and business needs, including the purchase of new equipment/machinery, home improvement, payment of medical bills, going on a holiday, getting married, etc.
A self-employed person can easily apply online for a personal loan and can pay it back according to his convenience.
Features and benefits of self-employed personal loan
⮚ Fast application process: Either on the lender's official website or financial platforms such as Afinoz, a self-employed individual may apply for a personal loan online. It is simple to understand the application process and can be done from the comfort of your home or office.
⮚ Loan amount: Personal loan for self-employed goes up to Rs. 40 lakhs from as low as Rs. 50,000 and can assist an individual to deal with different financial circumstances.
⮚ Minimum documentation: Only by uploading a few simple documents, including ID, address, and income evidence, can a self-employed individual access a personal loan online. This prevents the hassle of bringing stacks of documents to the bank.
⮚ Flexible tenure: All lenders of personal loans allow self-employed individuals to choose the tenure of their loan according to their ability to repay. In general, tenure ranges from 12 to 60 months.
⮚ Fast disbursement: Once a self-employed personal loan is authorized, it is disbursed within 3 to 5 working days to your bank account.
Personal Loan for interest rates for
self-employed
Personal loan interest rates for self-employed can differ from person to individual depending on their credit score, loan size, age, repayment capacity, etc., starting from at least 10.50 percent. Some of the banks that provide low personal loan interest rates for self-employed people are:
|
Banks |
Interest Rate |
|
Citi
Bank |
10.50%
onwards |
|
State
Bank of India |
10.50%
onwards |
|
HDFC
Bank |
10.75%
to 21.30% |
|
Axis
Bank |
12% to
24% |
|
Bajaj
Finserv |
12.99%
onwards |
Criteria for Qualifying
●
You should be a self-employed person,
●
You should be 21 years of age.
●
The eligibility requirements set by the bank should fit your
annual income
● Your company should run for at least 2 years,
Necessary documentation for loan applications
●
ID Evidence: Aadhaar Card, PAN Card,
Voter ID Card, Passport, Driving License, etc.
●
Residential Proof: Ration Card, Service Bills
(Electricity Bill, Phone Bill, etc.), PAN Card, Aadhaar Card, Voter ID Card,
etc.
●
Company evidence: proof of business life,
incorporation certificate, registration certificate with an appropriate
registration body
● Income evidence: Past 2-year ITR, Certified Profit And Loss Statement
Self Employed Personal Loan with:
▪
Low Score for Credit
One of the first items that a prospective lender test when a person applies for a new loan is your credit score. This is not only valid for self-employed applicants, but also salaried citizens applying for a personal loan. A low credit score usually makes it harder for a self-employed individual to be accepted for a personal loan.
Moreover,
if a self-employed individual with a low credit score is accepted for a
personal loan application, those deals also have a higher interest rate than in
the case of individuals with higher credit scores. As a result, it is
recommended that self-employed applicants first review their credit score and
take action to maintain a high creit score to receive the best personal loan
deals.
▪
No Proof of Profits
Repayment ability is considered to be one of the main considerations (in addition to the credit score) considered by a lender when considering a request for a personal loan. To assess the repayment capacity of an applicant, the lender considers both the income of the applicant as well as his/her current debt.
Although salaried applicants can easily include a salary slip or salary certificate along with Form 16 as proof of income, these options are not accessible to self-employed individuals. In the case of an unsecured loan, such as a personal loan, income proof documents are also mandatory. As a result, a self-employed individual cannot get a personal loan without proof of income or relevant financial records.
Main examples of such documents include, the P&L statement, recognized income tax reports, certified balance sheet, etc. for the past 2 to 5 years
EMI Calculator Personal Loan for Self Employed
The Personal Loan EMI calculator from Afinoz is an online feature that is easy to use and allows you to measure the EMIs that you will pay even before applying for the loan. The EMI calculator helps to analyze EMIs and other expenditures for all self-employed people so that they do not buy more than they can repay.
All you need to do to use the EMI calculator is to fill out the following:
● Sum of Loan
● Tenure Ownership
● Level of interest
For Example:
|
Loan principal @ interest |
Tenure |
||||
|
1 year |
2 years |
3 years |
4 years |
5 years |
|
|
2 lakhs
@ 11.99% |
Rs.
17,768 |
Rs.
9,413 |
Rs.
6,641 |
Rs.
5,265 |
Rs.
4,447 |
|
3 lakhs
@ 12.12% |
Rs.
26,672 |
Rs.
14,139 |
Rs.
9,982 |
Rs.
7,918 |
Rs.
6,692 |
|
6 lakhs
@ 13% |
Rs.
53,590 |
Rs.
28,525 |
Rs.
20,216 |
Rs.
16,096 |
Rs.
13,651 |
|
9 lakhs
@ 13.5% |
Rs.
80,596 |
Rs.
42,999 |
Rs.
30,541 |
Rs.
24,368 |
Rs.
20,708 |
Conclusion:
