If the self-employed get no credit – what now?
The most important step for a self-employed person in a loan rejection is asking for the reason why the loan was declined. In the next step, they should consider themselves as self-employed, where can I apply for a loan if the bank refuses? If the house bank refuses the loan, then you can rely on direct banks as a self-employed person. The direct banks check the credit rating and the monthly income and the private credit information play a significant role. In the article “Do not get a loan for self-employed what now?” We show self-employed persons which alternatives or which suggestions for improvement are possible for a loan application.
Contents get as a self-employed no credit – what now?
- If the self-employed get no credit – what now?
- Possibilities for loan financing despite credit rejection
- Alternative to bank loan – private loan platform
- The new trend on loan platforms are private lenders
- Reasons for a credit rejection
Possibilities for loan financing despite credit rejection
The opportunity for a loan financing can increase self-employed by specifying a second borrower or a guarantor. These persons should have no records and a regularly secured income in the private credit. If the collateral from the borrower should not be sufficient, then a guarantee can be requested through a guarantee bank. In the various federal states, a guarantee can also be applied for through a promotional bank for a loan. The self-employed can also apply for a loan on a loan platform on the Internet, since the acceptance guidelines are not as strict here as with a bank. The self-employed can also rely on the direct banks on the Internet.
Alternative to bank loan – private loan platform
The bank rejects the loan application for self-employed, then you have the option to look for alternatives to bank credit. In this case, there are private loan platforms such as auxmoney and smava on the Internet, which provide loans between individuals. Because on these credit platforms, not the banks decide on the award of the loan to self-employed but private financiers. The self-employed person presents himself and his concerns on the credit platform and enters the desired loan amount. When the desired loan amount is reached, the loan platform settles the loan. The borrower then transfers the loan installments to a partner bank, who then forwards the money to the individual lenders.
The new trend on loan platforms are private lenders
The new trend on credit platforms is private lenders. The concept of private lending is simple, as credit marketplaces provide borrowers and lenders with a dedicated platform on the Internet. For the lending here not only the numbers after the count, but also that the borrower receives better conditions by a good presentation of the loan project than by the house bank. A weak credit rating of the borrower can also be compensated by a good presentation of the loan project.
Reasons for a credit rejection
For a credit rejection, the most common reason for the self-employed is a negative private credit entry or lack of collateral. A good credit rating indicates whether the borrower can repay the monthly loan installments. Possible reasons for refusing a loan for the self-employed are:
- Lack of collateral
- Regular income not available
- Negative private credit entry
- Too low profit
- Return debit on the checking account
- No sales growth
- No guarantor available
- Self-employed is too indebted
Self-employed persons should always submit complete and correct documentation to the bank for a loan application in order to avoid a credit rejection.