Are you a part of the 51% of self-employed Indians? Wondering if you can get a loan to finance your business operations? Whether you want to expand your business, introduce new equipment or stock up on your inventory, you can finance all your business requirements with a loan.
Today, various lenders offer affordable finance options to self-employed professionals. And if you’re looking for a loan, here are a few tips to help you.
Check your credit score
When you apply for a loan, the lender requests for your credit report to evaluate your repayment history and creditworthiness. Before applying, check if your credit score matches the minimum requirement. A healthy credit score of 750 or above can help you secure a loan at lower interest rates.
At the same time, many lenders might also approve your loan even with a low credit score, though at a higher interest rate.
What’s the first thing you consider while applying for a loan? The business loan interest rate. While it is natural to look for lower interest rates, you must also factor in other loan terms to ensure you get the best deal. So, you must take time to shop around and compare multiple loan offers based on the interest rate, repayment tenure, flexible EMI plans, application process, extra charges, and so on.
Narrow down your options and use a business loan EMI calculator to estimate your payments to apply with your chosen lender.
Understand the eligibility criteria
Different lenders have varying business loan eligibility criteria for self-employed individuals. This includes age and income criteria. Here, lenders will also assess your business plan to determine if they will offer you the loan. It is best to contact your lender and check whether you fulfil the minimum criteria set by them.
Fill the application carefully
When you are applying for a loan, make sure to fill in the online application carefully. Here, you will have to provide various details such as personal information, income, business details, and so on. A properly filed application also helps speed up the loan process.
Get the documents in order
Correct documentation is the key to securing a faster loan process. Then, make sure to keep the required paperwork ready beforehand. With an online verification process, you will need to upload certain documents including, identity, address, business financials, P/L statements, and other proofs. Once the verification is complete, the lender will contact you with further details.
Read the fine print
Yes, you’ve thoroughly researched the lender and carefully considered the interest rate as per your affordability. But what about the other costs? Like any other loan, a business loan also comes with additional charges. These include a prepayment penalty, processing fee, foreclosure charges, etc. So, before applying, read the fine print carefully.
Meeting your business’ immediate and long-term needs is now easier than ever. A loan for a self-employed individual is the perfect solution for all finance-related challenges. Just check your business loan eligibility, fulfil the requirements, and get easy funds from your preferred lender.