Get a loan for a self-employed
La Traditional banking has toughened the granting of financing following the expected unfavorable evolution of the NPL ratio.
The self-employed during the pandemic saw their activity considerably reduced, so the tightening of bank financing is making it difficult for them to return to normality.
They must also face a continuous rise in raw material.
In this new context:
Is it possible to get a loan for a self-employed person?
In theory, yes; in practice, it will be much more difficult for you than for an employee with a fixed payroll.
It is one of the additional difficulties faced by these self-employed professionals who usually have very little support.
Since often, obtaining a loan for the self-employed is an impossible mission.
Do you know what other alternatives exist?
Difficulties of the self-employed to obtain credits
Banks are more reluctant and demanding when it comes to approving a loan to a self-employed.
It is not that they have anything against this group, but that they are usually penalized for the following reasons:
1. They lack recurring and stable income. They do not have a fixed payroll sustained over time.
2. It is essential demonstrate personal solvency.
This solvency depends, to a large extent, on the operation and profitability of the self-employed business.
Usually, you ask for a self employed loan when there are economic shortages or business opportunities.
When this happens, and since the income of these people is contingent on circumstances, they are times when they are charging less.
3. They must submit additional documentation.
From VAT and personal income tax payment receipts to bank movements, going through the latest Social Security settlements.
4. Approximately, they are required that their debts and monthly payments do not exceed 35% of income.
This percentage includes the payment of the credit for self-employed sought
Ultimately, they present a higher profile of risk and instability for banks.
Their income is conditioned by commercial fluctuations and by the impossibility of requesting sick leave.
For this reason, often the self-employed invoice advance and other less traditional formulas become the solution.
The advantages of alternative financing
Although in Spain banks still account for 80% of financing sources, in countries like the United States they have dropped to 30%.
If you are self-employed, you have at your disposal other formulas to obtain money.
El advance bills for self-employed it's just an example.
These non-bank options, known as alternative financing, provide you as a freelancer important benefits:
a) Obtain the necessary liquidity quick and simple
b) To diversify your funding sources
c) Get financing adapted to your needs
d) Simplify the process of financing. Financial institutions usually require less red tape than traditional banking.
What options are there?
There are multiple and varied alternative financing formulas available to self-employed workers. For example, him crowfunding, crowlending or find a business angel. However, there are simpler and more appropriate possibilities that are immediately applied and especially beneficial.
These include the following:
A) Discount of promissory notes.
B) Factoring.
C) confirming.
These possibilities depend directly on the income pending collection that the self-employed person has.
Consequently, they do not put the viability of the business at risk.
Simply, a future charge is transferred in exchange for having it at the present time.
In this way, we will be able to correctly manage our cash flows and have the necessary liquidity for the proper functioning of our activity.
A reference support
At WorkCapital we are specialized in personalized financing for companies and the self-employed.
Contacting us means accessing specialists capable of analyzing your situation, as a self-employed worker, and providing you with a individualized solution.
Through a specific study wrapped in maximum transparency, your business gets what it needs quickly and safely.
This analysis is carried out free of charge, without obligation, and culminates with one or several non-conventional financing proposals.
From the advance bills for self-employed at a promissory note discount.
In any case, we provide comprehensive solutions, not specific patches that can jeopardize the future of your project.
Something that, all too often, happens in a self employed loan.
