Possibility of Home Loan for Freelancers

Bangalore: If you are a self employed professional or freelancer, obtaining a home loan is a wearisome process because while approving a home loan for freelancers many lenders will consider job continuity, as they are free to quit their job. In case of salaried individuals, they can take pay slip and job stability as a guarantee. But now, by considering the growing crop of entrepreneurs many banks taking keen interest and diversifying their home loan opportunities to Freelancers - lawyers, doctors, merchants and kirana shop owners.

Banks follow different sanction procedure in case of freelancers and they were applying some measures to ease the sanction process. Even though, there will be a slight difference between freelancers and employed individuals. To ensure the profitable running of the freelancers business and capability of paying money back smoothly, banks will ask several documents.

The banks will follow stringent norms to approve home loan for freelancers. If you are a self employed professional/freelancer you should have at least three years of business record and they will also check your tax returns and credit bureau information to have a synopsis of the stability of your income.

The eligibility criteria for freelancers to obtain a home loan includes the freelancer should have gross annual income of Rs 1,00,000 or above, the age limit should be 23-58 years and for smooth process all documents such as identity card, residence proof, educational certificate and proof of business existence should be clear and originals is required for verification. If you are properly documented, you will be considered for home loan in the low risk zone.

Documents Check list for Freelancers:

1. Brief introduction of business
2. Duly signed application form with pass port size photo
3. 3 years CA certified Profit and loss statement with balance sheet
4.  Updated bank account statement of saving income for the last 6 months with last 3 years income tax returns
5. Photocopy of registration certificate as a proof of business existence under Establishments Act.
6. Photocopy of ration card, residence proof, pan card, ration bill, telephone bill and electricity bill.
7. Photocopy of investments such as shares and assets
8. Accurate picture of net worth
9. Photocopy of Business plan

The procedure will be same for self employed business person and self employed professional or freelancer. The loan amount depends on the capability of repayment determined by lender and the Equated monthly installment would be based on the rate of interest, repayment period and quantum of loan.