Many applicants who are self employed are often refused finance or worse still, it all becomes too hard and complicated, so they opt out of borrowing due to their overall business structures and excessive application requirements.
Some lenders assess the borrower’s financial capability utilising the latest financial accounts and require the last 2 years’ of financial accounts as a guide to ascertain the performance of the business. Other smaller lenders utilise the average of the last 2 years’ financial accounts and whilst the previous year could be lower than the current year, the borrower may be stymied by this requirement.
When issues with the economy arise or events like the Royal Commission occur, the default position of the banks would be to turn away anything that is too difficult or seem to be risky. Also, as the application process is automated, the personal connection between the borrower and the lending person at the bank becomes all but non-existent. Again, this is why an experienced finance broker is the crucial link to assist the borrower through the entire process in this very popular and large employment segment.
If you are self-employed and would like to explore your options please do not hesitate to contact Paul who can provide you with a smoother and less stressful process for your personal and professional finance needs.
Tags: self employed