Self employed loans
There is no denying that making a mark for oneself in the competitive world of business is tough. This holds true especially for people in UK who are self employed and dont have access to that extra sum of money that can make the task easier. But the question now arises: Where can they get that money from Well, in an ideal scenario the answer to this question can be easily traced with the introduction of self employed loans in the loan market.
If experts are to be believed self employed loans are tailored to meet the financial needs of self-employed people. Fact remained that they may need funds to expand or to start a new business. Theoretically speaking self employed people are identified as people who operate their own business as a sole owner or as a partner or a profession. In addition independent consultants and contractors are also classified as self employed.
It is worth mentioning in this regard that there are different characteristics of self employed people that differentiate them from the working group. As a matter of fact self-employed people have unstable income as profits vary from one period to another. In addition they do not have proof of their income.
Not so long ago, it was difficult for self employed people to borrow money from the market. In simple terms the main reason behind this is that they do not have a regular source of income; this seemed to pose a big obstacle in the path of getting finance for investment.
But, believe it or not now time has changed. Point to be noted in this regard is that with the entry of self employed loans it has become easier for self employed people to get an easy financial help. Furthermore it is worthwhile remembering that with the increasing number of people who prefer to work for themselves, self employed loans have now become affordable and widely available.
There is no denying that self employed loans can be secured or unsecured one. According to experts secured self employed loans are secured against the collateral of the borrower such as a car or a house. On the other side of the coin unsecured self employed loans are not secured by any collateral, thus involve a high interest rate.
Fact remained that some lenders in UK offer flexibility to the borrower by accepting overpayment, underpayment and payment holidays. Let us illustrate these terms which will make it easier for you to recognize the benefits of taking a self employed loans. In an ideal scenario overpayment imply that a borrower pay more money for a month than the amount due. While on the other hand underpayment is just the opposite of overpayment, it gives the borrower the freedom to pay a lesser amount in a month then the amount due. Theoretically speaking payment holiday is completely different from the two mentioned above. In simple words it allows a borrower to skip a limited number of monthly payments after an initial period of regular payments.
More often than not lenders of self employed loans assess borrowers income to evaluate the amount of risk involved in lending money to the borrowers. As a matter of fact they assess the income of a loan applicant basically by two ways:-
Self Certification It is worth mentioning in this regard that in this case, a borrower self declare his income and the lender do not insist on considering the audited accounts. But fact remained that there are some lenders who will need a borrower to submit an accountants certificate. According to experts this is a document signed by a borrowers accountant that entail that borrower has sufficient income to pay the monthly installments and the loan. Believe it or not most of the lenders supplement this information with evaluation of the credit score of the borrower.
Certified Accounts- Furthermore it is worthwhile remembering that certified accounts of the borrower will be issued by the borrowers accountant briefing the details of the borrowers income on yearly basis.
Point to be noted in this regard is that lenders can arrange self employed loans for homeowners or tenants for any amount ranging from 3000 to 250,000. Furthermore it is worth pointing that with the competition increasing day by day in the loan market, lenders are ready to provide the loan at low interest rate. In an ideal scenario interest rate is determined keeping all these in consideration amount to be borrowed, borrowers credit history and the loan term.
There is no denying that a good credit score will definitely help a borrower to get a loan for a larger amount at low interest rate. But, always remember that this loan is not confined to good credit people only. On the other side of the coin bad credit, CCJ or bankruptcy cannot stop you from getting this loan; however you may get it at a bit higher rate of interest.
Theoretically speaking survival of the fittest is the trademark used in the world of self employed people. But fact of the matter is to survive one need to match pace with the changing technology that is possible only when you have a financial backup. In simple terms self employed loans give financial support to the self employed people so that they too can make a mark in the competitive world and reach new heights of success.
In an ideal scenario one of the most fundamental details that all banks will look for in all loan applicants is a steady, dependable income. Theoretically speaking the amount of this income will decide how much the applicant will be granted. In case if there were no dependable income, then on the face of it, it would appear to a lenders calculation, that the loan amount should be zero. According to experts this is the traditional method of calculating personal loans. On the other hand business loans are calculated on a different basis. As a matter of fact they do not need to show guaranteed income.
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