Business Loan Smart Tips for Freelancers

As a freelancer, you are self-employed. That means you decide when and where you work and what assignments you take on. As a result, you have complete control over your financial decisions. Still, many freelancers aren’t aware of how hard it can be to get a business loan. So here are some tips to improve your chances of getting a loan. Hopefully, these tips will help you secure funding for your creative endeavors.

The Hidden Costs of Being a Freelancer

As a freelancer, you are the boss of your own schedule and the only one who pays the bills. But you must keep in mind that being self-employed is not free. 

There are hidden costs associated with freelancing, such as 

  • taxes
  • insurance
  • legal 
  • accounting fees
  • marketing
  • training
  • office supplies
  • software

These are all necessary for running a successful freelance business. You may have an office with a shared printer and computers in a traditional job. Still, you will be responsible for purchasing these items yourself in a freelancing career. Additionally, you will have to pay for gas to drive to a store. Even comfortable clothing can add up!

Why Do Freelancers Struggle to Get a Business Loan

Getting a business loan can be difficult for freelancers. The financial climate is highly correlated with debt, so freelancers often struggle to get approved for a business loan. However, if you take the time to prepare for the process, you can avoid pitfalls that lead to a failed loan application. 

When looking for the best small business loan, it is essential to remember that most lenders are wary of working with people with bad credit. In addition, even though most freelancers have good personal credit, they may not be able to keep their businesses up and running during times of personal emergencies. For example, extended hospital stays can wreak havoc on a business. Luckily, there are a few different business funding options for freelancers. Each has a unique set of features to suit a range of needs.

Best Business Funding Options For Freelancers

Many online sources offer different types of business funding for freelancers. In this article, we will cover Prosper, Upstart, BlueVine, and Lendio, to name a few. These online sources can help freelancers starting out or have an established business but bad credit. Read on to find out which one is right for you. You can find the best funding options for freelancers by weighing their pros and cons.

#1) Prosper


There are several ways to access Prosper business funding if you are a freelancer. The platform has a reputation for providing competitive rates on standard loans. In addition, it does not require any collateral. The loans are fixed-rate installment loans with a five-year maximum term and a minimum credit score of 640. The process of applying for the best business loan is quick and easy. You can get started as soon as the next business day.

#2) Upstart


Personal loans can be a valuable funding source when you’re in the early stages of your freelance business. Unlike traditional lenders, Upstart doesn’t look solely at individual credit scores when evaluating loan applicants, instead of weighing several factors, including job history and education. When it comes to obtaining a business loan, most options are for startups or people with decent personal credit.

#3) BlueVine


While you might already be familiar with BlueVine business funding options for freelancers, you might not know that they offer a business checking account. This account is for businesses only, but it still earns interest. As a business owner, having a business checking account is helpful, and it has many advantages. For example, there’s no minimum balance requirement, and you can withdraw money free of charge from MoneyPass ATMs. Another great feature of BlueVine is the flexibility of the payment system. They can fund unlimited invoices and reimburse you once your clients pay. 

#4) Lendio


If you need money for your small business, Lendio has several freelancer funding options. You can apply in less than 15 minutes and get a decision in 24 hours. In addition, the company’s network of more than 75 lenders provides various business funding options for freelancers. Lendio is also a good option if you have bad personal credit. 

#5) Credibly


This alternative lender has various funding options, including a line of credit of up to $250,000, a working capital loan of up to $400000, invoice factoring, and equipment financing. Credibly is one of the few lending companies working with a freelancer with bad credit and a business with high revenues.

#6) Kiva


This platform allows you to request small loans from people you know and trust. You can apply for a loan of up to $25, and Kiva will verify your information and confirm your eligibility. You can also view the Kiva guidelines to help you apply for a loan. Here are some things to keep in mind:

Kiva offers two loan products for freelancers and small businesses: crowdfunded microloans and traditional loans. Both offer 0 percent interest and repayment terms between twelve to 42 months. You can find out how much money you can borrow by submitting an application today! Just remember that it’s essential to follow the repayment terms.

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