Financial institutions to grant you credit instruments, such as credit cards and loans, require an income support. Then, if your economic activity makes it uphill that you can meet that requirement, surely you must have wondered if you can get a loan without supporting income . If you want to know the answer, keep reading in this article.
What is income support and what is it used for?
Income support is a procedure by which you demonstrate that you have a consistent source of monthly income. In most cases, to sustain the income you only have to present one or more formal documents, which validate that you have said source. For example, if you are a salaried employee, you can present a proof of work that includes your seniority and earned salary, and/or your tax return.
This procedure is used by financial institutions to determine the payment capacity of those who request loans. Thus, they can determine what is the monthly fee that the applicant is able to pay, which is generally around 30% of sustainable income.
Is it possible to get a loan without supporting income?
The answer is yes, get a loan without supporting income, as long as you do it with a private investor, instead of a financial institution. A private investor, also known colloquially as a lender, is a person who is dedicated to providing loans.
A private investor works mainly with clients of moderate and high risk of default of payment that, being in this condition, are neglected by banks. Therefore, they do not require income support or have a good credit history, but simply request that the loan be backed by placing some asset as guarantor. Also, as a counterpart to the risk it assumes, an investor offers loans at an interest rate higher than the bank’s corresponding ones.
Among the options you have when applying for a capital loan from a private investor, the one that usually offers better conditions is the mortgage loan. In this case, by placing a property you own as a guarantor of payment, the investor runs less risk of losing his money, and offers you a better interest rate.