Freelancing, on demand and gig work is increasingly common, accounting for nearly 45% of all employment in America. But working for yourself comes with its own set of challenges, not least of which are financial. Setting yourself up, finding clients and paying bills are all more difficult when going it alone, and many people find themselves in need of a little extra help at some point. This is common for gig workers of all kinds, from graphic designers and online-based freelancers to delivery and ride-share drivers.
Yes, gig workers can definitely get a loan! However, personal loans for gig workers may require a little more paperwork. Because gig workers' income often comes from multiple sources, the loan eligibility process isn't always easy.
Gig masters may require more proof of income than regular employees, but they still qualify for most types of loans.
Mortgages, vehicle loans, and personal loans for gig workers are well within reach as long as you can meet your lender’s other requirements.
Gig workers earn income through contract (“gig”-based) labor and file taxes as self-employed. Because of their alternative employment status, those in the gig economy must often work harder to receive the same personal loan options as traditional employees.
Whether you’re a full-time employee or an independent contractor, the basic criteria to qualify for a loan are the same: Lenders look at your credit score, your assets and your income history. Gig workers can face challenges if they’ve been working for themselves for only a short time – less than two years – or make too little money to qualify under standard underwriting rules.
Regardless of the payment method, mortgage lenders want to see steady income over two years.
This tax refund problem is huge. Self-employed taxpayers are wise to take full advantage of the many tax deductions and relief provided by the IRS. However, while accumulating expenses on your tax return will lower your tax bill, this practice can make it harder to get a loan.
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