Personal loans for self-employed borrowers
A personal loan for a self-employed borrower is a standard unsecured installment loan underwritten with self-employment income, typically Schedule C, K-1, or 1099 earnings, instead of W-2 wages. Lenders need additional documentation to verify income, but creditworthy self-employed borrowers can access the full personal-loan market.
Why apply here.
- 01Sole proprietors, LLC owners, and S-corp owners all qualify
- 02Loan amounts from $1,000 to $50,000
- 03APRs typically 6.99% to 35.99% (credit-dependent)
- 04Typically need 2 years of tax returns to verify income
- 05Strong credit and 2+ years self-employed unlocks the best APRs
About this loan.
What income documents do self-employed borrowers need?+
Most lenders want two years of personal federal tax returns (Form 1040 with Schedules C, E, and/or K-1). Some accept one year if the business is stable. Recent bank statements (typically 3-6 months) verify cash flow. Newer businesses may need to provide a year-to-date P&L.
How do lenders calculate self-employment income?+
Most use a two-year average of net income from your tax returns (Schedule C line 31 for sole proprietors). Some add back depreciation. If income trended down year-over-year, lenders use the more recent (lower) year. If it trended up, the average usually controls.
Can I get a personal loan with less than 2 years of self-employment?+
Yes, but options narrow. Some online lenders accept 1 year of self-employment if you have 3+ years of stable W-2 income in the same field beforehand. Strong credit (700+) significantly helps when self-employment history is short.
Should I use gross or net income?+
Lenders use net (after-tax-deductible expenses). This can be lower than what you'd report on a W-2 application. Some self-employed borrowers consciously reduce deductions in the year before a major loan application to show higher net income, discuss with a tax pro before doing this.