There is no harm in working for yourself as long as you are earning enough money. Being self-employed is equally overwhelming & stressful for every entrepreneur. You may find it hard to arrange finances for running the venture smoothly. In this era of competition, what we actually require is monetary help to support our plans.
Over recent years, there have been many modifications in the lending landscape of the United Kingdom. Taking into consideration, the latter revenue of two to three years, lenders are ready to accept the loan application of borrowers who are self-employed. It’s true that a decent set of trading accounts will provide more options to the borrowers.
While trying to stay in business, many side hustlers damaged their credit history due to the credit crunch. Many even went out of business. Hence, bad credit history is no longer a barrier to self-employed individuals. If they can afford the proposed loan now, they can get the funds they desire.
“Strength and growth come only through continuous effort and struggle.” — Napoleon Hill
Given below are top 5 tips to manage a Self-employed Loan in the best way possible – This grind is worth every try!
- Keep a Check on Your Credit Score
A healthy credit score allows you to negotiate better about your debts with your lender. A good credit rating allows you to crack a better deal. While you are using a self-employed loan, ensure that you maintain a favourable credit record by paying it back on time. On the other hand, a bad credit score may result in offerings that have a high rate of interest.
- Avoid New Debt
Debt management mostly boils down to financial discipline. Borrow the amount which you can repay comfortably and on time. By adding to a new debt to your pile, you are dragging yourself and your venture into more troubles rather than sailing out smoothly.
If you are having trouble with the repayments, you should be looking for ways to cut back costs or increase sales. You can also consolidate your existing debts together.
- Pay More When You Can
We all are aware of the fact that businesses are seasonal. Which eventually impacts the number of earnings every month.You can keep aside part of your earnings, which you can use later to pay the instalments of your self-employed loan on time.This will help ease your overall burden a bit. Also, it will help you to manage your personal finances in a better way.
- Communicate with Your Lender
Always remember, communication is the key to every solution. Do consider discussing the circumstances that are making it difficult to pay back the amount on time with your lender.Whenever you face financial hardship while repaying the loan, talk about it with your lender. Or else there are various free debt advice services that you may opt such as Money Advice Service, StepChange, etc., They may be able to help you out.
Some Common FAQs Regarding Self-employed Loans
- Q. I have bad credit and willing to start a business, can I get a loan?
- A. YES, you can. Lenders offer self-employed loans to individuals with imperfect scores in the UK. A good credit record is no longer the only eligibility criteria for these loans. You may apply for a personal loan even with your not so perfect credit score.
- I had faced many loan rejections in the past, is there still any possibility for securing a loan?
- A. Just because one lender denied your credit application, it doesn’t imply you’re going to be rejected by all. The eligibility criteria can vary from one lender to another. However, you can apply online at Loan Broker to get access to FCA registered lenders, for whom a credit history is not the only criteria for granting a loan.
- Can I consolidate my debts by using a self-employed loan?
- Yes, you can. Many people use these loans to merge their existing debts into a single amount. But, make sure you take out this loan responsibly, as default in payments for the same can further damage your credit score.
Final Word
Nothing is impossible if you are willing to make things work- Loans for Self-employed People is a way to provide means to people who are trying to make their passion a profession. If managed properly, these loans can help you arrange working capital, investments and funds for many other business necessities. Moreover, if you have a bad credit rating, there is a chance for you to build and maintain a spotless credit history, if only you repay the loan amount on time and in full.
You can apply online at Loan Broker and get access to FCA registered lenders in few easy steps.
