If you want to avail of a personal loan, remember that the major factor that is considered is your capacity to repay. As for availing of a personal loan, the recovery risk is extremely high owing to the non-presence of security or collateral, and your month-on-month income is the metric for checking your repayment capacity. This is the reason why your salary slip is an important document for proceeding with your loan application process. And this parameter is also considered to be one of the crucial personal loan eligibility criteria.
However, those who are self-employed or work as freelancers often wonder how they can proceed with the loan application process without a salary slip. Note that with alternate income documents, it is very easy for both the self-employed and salaried professionals/individuals to avail a personal loan with zero salary slips.
How can you get your personal loan without any salary slips?
Many work to earn a monthly income; however, there are zero records like salary slips for the salary they draw as they do not get paid through cash. In these cases, how can you avail of personal loans with zero salary slips?
Lenders usually evaluate your financial profile to understand your capacity to repay before conveying the credit decision. Salary slip scrutinization is a part of assessing your financial strength. What can you do to show your repayment capacity if you don’t have a salary slip?
There indeed are other crucial documents that vouch for your financial strength. Even an individual who draws a specific salary through cash has a savings bank account where it can deposit the drawn salary. A constant cash deposit on the same date each month comes across as proof of money drawn. Thus, a bank statement, form 16, account passbook, ITR can be simply submitted as proof of income if salary slips for a personal loan are not present.
In the event of professional/self-employed individuals, audited financial statements such as profit and loss account and balance sheet along with the ITR and income computation come across as income proof for the personal loan without any salary slips.
How can you apply to a personal loan without any bank statement?
If a salary slip is not present, one can still avail of a personal loan by submitting alternate income proof like a bank statement, particularly in the case of self-employed individuals. Self-employed professionals or individuals have a bank account to conduct their transactions, and by consolidating service/sales receipts routed via the bank, the lender can understand the business turnover.
Likewise, in the situation of salaried individuals, salary is routed via a bank account, and thus with the bank statement, the lender can ascertain the applicant’s monthly income. However, how can you avail of a personal loan without any bank statement and salary slip?
In case you do not have any bank statement, you still can apply for the personal loan with the audited financial statement as well as ITRs with the income computation if you are an individual who is self-employed. Salaried individuals can provide form 16 as income proof. These alternate documents are adequate for validating your income. Forming a good relationship with your lender and ensuring to maintain a good credit score can assist in such circumstances.
Yet another way for you to avail of a personal loan without the bank statement and salary slip will be by including a co-applicant with a steady income source and good credit score – note that the co-applicant shares the same responsibility for loan repayment. Co applicant’s income helps instil confidence in the lender about your capacity to repay. The co-applicants creditworthiness is a yardstick to determine your personal loan eligibility.
Crucial other documents required for availing a personal loan with zero salary slip
In case you are a self-employed individual or hired on a contract basis or a freelancer, you will require applying for the personal loan without any salary slip. How can you apply to a personal loan without any salary slip?
It is absolutely possible for you to avail of a personal loan without any salary slip by providing an alternate document that crucially validates your annual/monthly income. In case your work is on a freelance basis, you can get paid through cash or hired contractually. For this, you can submit the listed alternate documents.
∙ Bank statement: Even though your salary is getting paid in the form of cash and there are zero records for your month-on-month emoluments, it is very certain that you will deposit your cash salary in your bank account. A regular deposit of the same cash amount per month is good enough to prove your stable income source. A self-employed professional or individual will route your business transactions via bank accounts. Thus, you can produce your bank statement as alternate income proof.
∙ Employer certificate: A certificate from the employer or letterhead proves your link with the organization. Certificates must contain details such as your name, itemized monthly emoluments and employment details. It will indicate your job and income stability.
∙ Income tax returns: In case you are a taxpayer, you can produce the IT returns for the past two or three years to prove your income stability.
∙ Form 16: Form 16 issued by the employer will contain the info of the overall income, deductions, and deductions for a specific financial year. It is a valid proof of income that can simply be submitted when availing of the personal loan without the salary slip.
∙ Audited financial statement: The audited financial statement, such as profit and loss and balance sheet account, will show the financial health of the institution. The company’s financial profile can be reviewed with the document.
Alongside the above-mentioned proof of income, you will require submitting the standard KYC documents such as passport, Aadhar card, driving license, identity and residential proof.
Basic Bajaj personal loan eligibility tips without salary slip if you are looking to avail loan from Bajaj Finserv
Evaluating the income is a part of loan processing, and the salary slips are the authentic income validation mode. Having said that, not always can you provide your salary slip as income proof to prove your repayment capacity. There are a few categories of loan borrowers who may not be able to submit the salary slip for the personal loan. The basic question is, if they cannot establish the source of income, then how can they avail of the personal loan without any salary slip? Here are some valuable Bajaj personal loan eligibility tips, which other personal loan lenders always factor into proceeding with your application without income proof.
∙ Credit score: Aim to maintain a credit score of over 750. A credit score of over 750 is exceedingly appealing to lenders as this indicates your acumen to financially manage, your commitment towards repayments of loans and establishes your credibility. This provides assurance to lenders about your liability towards servicing the EMIs.
∙ Provide other important documents: If you are not in a job for quite a while and do not hold the latest salary slips or you are being paid your salary through cash, it is possible to establish your income source without any salary slip. You can do so through your income certificate from your employer, form 16 statement, bank account statement etc.