Self-employed individuals are no different from salaried individuals when it comes to facing financial problems. Thus, self-employed individuals are likely to need a personal loan like salaried guys. That said, lenders always hesitate while approving a self-employed individual’s application due to income instability. However, that can be avoided by following the below-shared checklist.
1) Business Credit Score
CIBIL score is inevitable which is closely monitored by lenders while approving a loan, especially if the applicant is self-employed. Thus, the first factor you must ensure is to check your credit score. This goes without saying if you have availed different loans previously. If there’s an issue with your credit score, it’s better to wait than to proceed with the application.
Apart from your score, you must also check your credit history. The same comes attached with your credit report and has to be in a good shape if you wish to get approved for the loan.
2) IT Returns
To verify your income and to ensure your eligibility for a personal loan, you must have the ITR receipts of at least two years. If you haven’t done it yet, start filing your ITR because there’s no way you can get approved without submitting the receipts. You can file advanced ITR if there’s a scope to do so and use the receipt to avail the loan.
3) Business Vintage
Last but not least, since work experience matters a lot in the approval of personal loans, your business must have a minimum vintage of 3 years. That’s the minimum requirement and hence, you have to keep it in check.