How to get a loan for an individual entrepreneur: step by step instructions

2024 Author: Howard Calhoun | [email protected]. Last modified: 2023-12-17 10:16

Many people prefer to register an IP when starting their own business. This is due to the fact that you can choose simplified taxation regimes, and the registration process is considered simple and fast. It is especially important to register an individual entrepreneur if you plan to run a small business. If an individual entrepreneur works under simplified regimes, then he does not have statements containing information about his income. Therefore, banks rarely provide large and profitable loans to individual entrepreneurs. Most often, businessmen have to focus on standard consumer loans.

Features of IP lending

Each bank wants its borrowed funds with interest to be returned in a timely manner. Therefore, obtaining a loan by an individual entrepreneur is complicated by the impossibility of a potential borrower to confirm his solvency. It is required from the individual entrepreneur to have proof that he will cope well with payments, so there will be no delays.

As confirmation, there are different types of reports generated and submitted by individual entrepreneurs to the Federal Tax Service. But usually they do not reflect the level of income of a businessman, so you can only count on a small borrowed amount issued at high interest rates.

The only option for individual entrepreneurs under such conditions is to open a bank account, where the movement of funds will be constantly recorded. By looking at the account statement, an employee of a banking institution will be able to make sure that the applicant has sufficient funds to repay the loan.

What does the bank evaluate?

Before issuing a loan, the bank needs to make sure that the entrepreneur is solvent, and also meets many requirements. Therefore, the applicant is required not only to confirm solvency, but also many other documents.

Standardly, a loan to an individual entrepreneur is provided subject to the following conditions:

• a high level of income, for which the amount of revenue for a specific period of time, usually represented by a year, as well as tax deductions and net income, if available, are estimated;
• good credit history, therefore, in the past, a potential borrower should not have any delinquencies on other loans, and it is also checked whether the businessman has tax debts, how many loans were previously issued and paid, whether there are any outstanding loans;
• owned property that can be used as collateral, and with suchconditions, the maximum amount issued by the bank is calculated on the basis of the assessed value of the object;
• opportunity to attract a guarantor;
• life of the business, and the standard requirement is for the entrepreneur to work for more than one year;
• no significant administrative or criminal violations in the course of business.

With good profits and stable work, an individual entrepreneur can count on fairly good offers from banks. At the same time, there should be no overdue and outstanding loans.

Types of offers

For banks, individual entrepreneurs are considered the most difficult and specific borrowers, so they are offered a limited number of loans. You should first assess what loans you can count on for individual entrepreneurs. Banks usually require collateral or offer small loans. The most popular offers include:

• express loans issued in a few hours, and usually they are issued on credit cards;
• loans designed to start or grow a business;
• consumer loans with or without collateral.

If you plan to issue loans to individual entrepreneurs without collateral, then you should not count on a fairly large amount.

The nuances of obtaining express loans

They are issued to any entrepreneur or individual. Their design features include:

• you can get funds in a short timea period of time that usually does not exceed two hours;
• a small amount of funds is provided;
• you have to pay significant interest for the use of money;
• the issuance of such loans to individual entrepreneurs is not accompanied by the need to prepare a large amount of documentation;
• you can apply for such a loan not only at the bank, but also directly in the store if you need to buy any large equipment;
• no need to prove solvency.

Usually individual entrepreneurs use this offer if they do not have enough money to buy furniture or office equipment. An express loan also includes a credit card with a significant limit.

Loan for starting a business

As part of such loans, banks usually develop specialized programs. According to them, certain requirements are imposed on IP and different registration conditions are taken into account. If a citizen is only planning to open his own business, then he often needs initial investments, presented in the form of borrowed funds. You can get a large amount in the bank to open a business under the following conditions:

• presence of a competent, detailed and correctly calculated business plan with specific costs, expected income and planned profitability and returns;
• opportunity to pledge valuable property represented by any real estate to the bank;
• invitation of a guarantor represented by an officially employed anda well-earning citizen.

Under such conditions, quite large loans are often issued, but if the individual entrepreneur cannot cope with payments, he will lose the collateral, which will be seized and sold at auction by the bank.

Loan for business development

In addition, loans are provided to individual entrepreneurs for business development. They are usually issued within the framework of special programs. According to them, it is allowed to direct funds for some purposes:

• increase in assortment positions;
• buying equipment or vehicles for work;
• development of a new direction in business.

Under such conditions, the IP must confirm various facts:

• good solvency, therefore, official work is required from 1 year, positive results of activities for various reports, as well as the movement of funds on accounts;
• positive credit history;
• there must be no tax debts or outstanding loans in other banks.

Standardly, within the framework of various programs, banks offer loans to individual entrepreneurs for up to 5 years in the amount of up to 1 million rubles. and with a rate ranging from 23 to 28 percent.

Consumer credit

It is considered the most popular among IPs. Issued to both businessmen and standard individuals. The main conditions for its design include:

• necessarily confirmed solvency officialpapers;
• if an amount is issued that does not exceed 100 thousand rubles, then you need to prepare a complete package of documentation, which determines the stability and profitability of an existing business;
• if the amount reaches 500 thousand rubles, then a guarantor will be required, and banks impose strict requirements on him, since he must work in an official job, receive a high salary, and he must also have a positive credit history;
• if you need an amount exceeding 500 thousand rubles, then additional property will be required from the borrower as collateral.

Thus, the requirements for borrowers depend on the loan amount issued.

What counts as a businessman?

A business loan for a sole proprietor should be done carefully, as he must make sure that he can cope with the payments. Otherwise, he will have delays, for which fines and pen alties will be charged. This leads to a significant increase in the final amount that the bank will have to return. When applying for a loan, you must indicate the actual purposes for which the funds will be directed.

What documentation is required?

Many entrepreneurs work on the simplified tax system or UTII. Under such conditions, it is difficult to prove solvency. Therefore, the bank provides a loan to individual entrepreneurs upon presentation of numerous documentation:

• passport copy;
• certificate of IP registration;
• declarations submitted to the Federal Tax Service withinlast year of work;
• an extract from the USRIP, and you need to get it at the tax service immediately before transferring it to a bank employee;
• certificate from the Federal Tax Service on all open accounts;
• Account statements indicating the movement of funds;
• certificate from the Federal Tax Service on the absence of tax debts.

Employees of any credit institution may require additional documentation. For example, documents for collateral, papers from a guarantor or invoices, price lists, cash books and other documents.

Which banks provide?

Many credit institutions work with individual entrepreneurs. Sberbank loans to individual entrepreneurs are considered the most relevant and acceptable under the conditions. They are easy to apply and have low interest rates. Various programs are offered, for example:

• overdraft in the amount of 150 thousand rubles. for 4 years at a rate of 14.8%;
• loan for the purchase of commercial facilities, which offers an amount of 200 thousand rubles. for up to 10 years with a rate of 15%.

Sberbank loans to individual entrepreneurs are provided only with a full package of documents.

Also interesting programs for businessmen are offered by VTB24, Alfa-Bank, Raiffeisenbank and Russian Agricultural Bank.

Design process

Due to the difficulty of confirming solvency, the procedure for issuing a large amount of funds usually takesa lot of time. This is due to the need to confirm a suitable financial condition and the optimal income of the future borrower. How to get a loan for an individual entrepreneur? For this, sequential actions are performed:

• a bank and a lending program are selected, for which the available opportunities and goals for obtaining a loan amount are taken into account;
• gathering the necessary documents for registration;
• applying for funds;
• need to wait for the bank's decision;
• if it is positive, then you should come to the bank branch to study the clauses of the contract, and it is advisable to use the services of an invited lawyer during this process;
• signing a loan agreement;
• funds are provided to the entrepreneur.

Standardly, the process is completed within three days. The period during which the solvency of a citizen is checked can be extended if he uses simplified taxation regimes during work.

What are the reasons for being rejected?

For each bank, an individual entrepreneur is considered not a very attractive borrower. This is due to the lack of a constant and stable income, the inability to confirm the exact cash receipts for a specific period of time and the instability of the business. Therefore, usually the refusal to provide borrowed funds is due to reasons:

• poor ability to pay based on submitted tax returns for the year of operation;
• presence of other outstanding loans;
• bad credit history due to regular delinquencies on past loans;
• debts on taxes, utilities or other important payments.

All applications are considered by a special department of a banking institution, whose employees have access to numerous databases and information resources. Therefore, they can quickly obtain information about the credit history and debts of a potential borrower. If a loan is issued to open your own business, then the refusal to provide funds is usually due to the lack of a business plan, the choice of an unpromising direction of work, or the inappropriate education of the future entrepreneur.

Conclusion

Thus, every person planning to open his own business should figure out how to get a loan for an individual entrepreneur, what types of loans he can count on, and what documentation is required from him.

The procedure for lending to individual entrepreneurs is considered difficult for every bank. Numerous and strict requirements are imposed on businessmen. Often, applicants receive a refusal to provide borrowed funds due to various reasons. It is most easy and simple to get credit money if a bank is offered a pledge, a guarantor is involved, or an individual entrepreneur works on OSNO, therefore, the amount of profit is clearly stated in his financial statements. You can apply for a loan in different banks, but it is advisable to choose specialized programs that offer profitable loans at reducedinterest rates for businessmen.