Can I get a loan without proof of income? What are the alternatives? If you apply for a loan from a bank, the bank must always be sure that it will get its money back. With real estate financing, it is usually the case that you have to bring a certain rate of equity into the financing. There are loans without the addition of equity capital, but loans without proof of income tend not to exist, because even if you apply for a loan without equity capital, the lender must at least have the security of your creditworthiness that they can later repay the loan. Income is therefore a central point when granting loans – this is checked via a salary slip or a pension statement.
Payroll: an open book for the bank
Payroll is even very welcome, because you can read a lot from it about the creditworthiness of the potential borrower and whether he is eligible for financing. So you can see on the payroll not only how much net and gross wages you get, but you can also deduce from the income tax class and child allowances whether there are any obligations regarding maintenance. As you know, you have a different income tax bracket when you are married – which automatically means for the lender that you are required to pay maintenance.
If you think that everything that can be read from the payroll is already wrongly thought – it reveals even more: It also shows how long you have been in your position with a company. Potential borrowers who are still with their employer during the probationary period are less likely to get a loan because the creditworthiness does not yet have such security as if the employment contract is for an indefinite period. But that’s not all: the payroll also reveals whether any attachments are in progress.
Credit rating for lending
A pay slip is therefore an essential prerequisite for the granting of a loan and a loan without proof of income would be for the bank as if it were buying the pig in a poke. The higher your income, the more likely it is that the bank will give your credit rating a positive rating and therefore also entitle you to get higher loans. Without proof of a salary, in the framework can be set for which loan you would be entitled to.
If the first step in the credit check has been successfully completed, the bank will obtain information from credit report and get an idea of whether you have already taken out loans that still have to be repaid. Attention is also paid to whether there have been problems with your repayments in the past or whether you are a trustworthy customer who pays the installments on time.
There are alternatives with poor credit ratings
Loans without proof of income are therefore not possible. However, there are still one or two alternatives: Special institutions do not make such a fuss about creditworthiness and credit report, so there are loans from private to private or installment loans without credit report.