Personal loans for self employed

What is a self-employed personal loan?

A self-employed personal loan is a personal loan for people who are sole-traders or run their own business. While the application process is a bit different for self-employed personal loans, there are still plenty of options available to people who are self-employed. Typical options available to self-employed people include the following:

• Specialist loans. The first way is through a specialist lender who provides personal loans for self-employed people. These may include lenders that offer self-employed loans for tradies or personal loans for ABN holders.
• Standard personal loans (secured or unsecured). You can apply for any standard personal loan if you can meet the documentation requirements as an employed person.
• P2P loans. You can also submit an application to a P2P lender if you meet the eligibility and employment criteria.
• Low doc loans. If you cannot meet the doc requirements, you can apply for a low doc loan, which requires fewer documents, although this type of loan is usually more expensive than a traditional loan.

How can I get a personal loan if I’m self-employed?

You will need to check the lending criteria of each to see if you qualify. If you're unsure about a lender's eligibility criteria, it's important that you contact that lender prior to submitting an application with any questions that you may have. There are also specialist brokers who may be able to assist you in preparing the right paperwork.

Keep in mind that for a standard personal loan, you'd usually need to provide at least two years of tax statements in order to qualify as a self-employed person. Depending on your lender, you may also be required to put up collateral as security for your loan.

Do I need to apply for a low doc loan?

Low doc loans can be a useful resource for self-employed people who may not otherwise be approved for a standard personal loan. This is because they require less documentation than traditional loans, which means a quicker and easier application process. So, if you struggle to prove your income or assets, you may find it easier to be approved for one of these loans.

However, the only reason you should apply for a low doc loan is if you can’t meet the documentation requirements set out by a standard personal loan. Low doc loans normally have higher rates and fees than standard loans, especially if you're dealing with a specialist lender. They also usually have fewer features and less flexibility than traditional loans. So, you don’t necessarily want to apply for one unless it’s your only option.

What documentation do I need?

For self-employed applicants, lenders usually require any or all of the following documentation. Keep in mind that applying for a low doc loan may mean you won’t need some of these documents:

• Tax returns. Be prepared to show the last two years of your full personal and/or company tax returns. These will help prove any income you declare on your application.
• Financial statements. These may include any profit/loss statements to also support the income you declare.
• Proof of rental income. If you have any income from rental properties, you can declare this with real estate statements or copies of your executed lease agreements.
• Notice of Assessment. Make sure you have on hand your latest Notice of Assessment (NOA) given to you by the Australian Taxation Office (ATO). This shows tax information such as the amount of income tax you owe(d). Depending on the lender, you may need to provide your NOAs from the last two years.
• Recent bank statements. This includes statements showing your savings and business transactions. It may also include statements showing any other outstanding loans or credit cards you have with other lenders.
• Company-specific information. If you own your own business, be prepared to provide information such as your company’s ABN, address, etc.
• Personal identification. Depending on the lender, this may be your Australian driver’s licence, passport or proof of age card. You’ll either need to copy your ID and fax it over to the lender or scan it and attach the digital file to your application.

Personal loans for self-employed applicants

Lender	Interest rate	Loan amount	Available to self-employed?	What documents are needed?
ANZ	10.50% p.a.	$5,000 to $50,000		Most recent personal tax return Corresponding ATO Notice of Assessment Both need to be less than 18 months old
Bankwest	8.99% p.a.	$3,000 to $50,000		Financial statements and tax returns for the last two years
Bank of Melbourne	8.89% p.a.	$2,000 to $50,000		Recent tax information
BankSA	8.89% p.a.	$2,000 to $50,000		Recent tax information
bcu	8.94% p.a.	$5,000 to $75,000		Name of the business Accountant's name and address Personal tax returns and notices of assessment from the last financial year
Bendigo Bank	12.79% p.a.	From $2,000		-
Citibank	20.49% p.a.	$5,000 to $75,000		Accountant's name and contact number Name of their accounting firm
CommBank	11.50% p.a.	$4,000 to $50,000		Two years of tax returns or financial statements Most recent ATO Notice of Assessment
CUA	11.89% p.a.	$5,000 to $60,000		-
Gateway Bank	9.84% p.a.	$3,000 to $30,000		Details regarding your income
IMB	8.98% p.a.	$2,000 to $30,000		Two years of fully lodged tax returns ATO Notice of Assessment
Latitude Financial	7.99% p.a.	$3,000 to $70,000		Tax return
ME Bank	10.98% p.a.	$5,000 to $50,000		Two years of tax returns ATO Notice of Assessment
MoneyMe	6.25% p.a.	$2,100 to $50,000		Industry Company name Work phone number
NAB	6.99% p.a.	$5,000 to $55,000		Most recent personal income tax return Most recent ATO Notice of Assessment
Plenti	6.39% p.a.	$5,000 to $50,000		Proof of your income for the last two years
RACQ	9.34% p.a.	$3,000 to $60,000		Proof of income
RACV	6.49% p.a.	$5,000 to $30,000		Proof of income
SocietyOne	6.45% p.a.	$5,000 to $50,000		Proof of income
St.George	8.89% p.a.	$2,000 to $50,000		Recent tax information
Westpac	8.99% p.a.	$4,000 to $50,000		Proof of a regular permanent income

Are self-employed loans more expensive than standard personal loans?

As mentioned earlier, low doc loans are usually more expensive than standard personal loans. This means that you should try to qualify for a standard personal loan before you look for a low doc loan.
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Keep in mind that many banks and alternative lenders may offer loans that aren’t more expensive than standard loans to self-employed individuals. Make sure you’re comparing all options and that you’re aware of exactly what’s out there before deciding to apply with any particular lender.

How can I compare my options?

Keep in mind the following factors when comparing the loans offered by different lenders:

Frequently asked questions

• How much can I apply for?

  This depends on several factors such as your particular lender, your requested loan amount and how well you meet eligibility requirements. You can always find out the minimum and maximum loan amounts offered by a lender by clicking through to the particular lender's review page using the table on this page.

• What pitfalls should I avoid when applying?

  Make sure you understand exactly what you need the loan for and avoid getting mired into too much debt. This means that you should avoid applying for loans if you don't actually need them. Also, make sure you never apply for more money than you actually need.

• What are some extra tips to help me qualify as a self-employed applicant?

  First, always check that you meet all eligibility and documentation requirements before applying for a loan. Secondly, consider having a guarantor sign off on your loan, which would help alleviate any hesitation on the part of the lender. Finally, you can file a joint application with another person, where you and the second party would be equally responsible for the requested loan.