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34.9% APR Representative (variable)
Intelligent Lending Ltd (Credit Broker). Capital One is the exclusive lender

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Can I get a credit card?

If you’re self-employed, you’ll probably already know that it can be harder to get a loan or a mortgage when you own a business or you work freelance. If your income fluctuates, some credit card lenders just won’t be willing to take a risk on you – but that doesn’t mean they’re all like that.

It all depends on the lender and the credit card you choose. To find out more about the obstacles you may face when applying for credit – and how to overcome them - read on.

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Fluctuating income

There are certainly some great things about being self-employed – you’re your own boss, you can pick your hours and you don’t have to commute if you work from home. But it can also make it difficult to manage your money. Even budgeting can be hard if you’re self-employed as your income may vary from month to month, meaning it can be a struggle to pay some off your essential bills.

As a result, you might find that you come up against some problems when you apply for credit. Not all lenders will accept you if you’re self-employed, as they could assume – perhaps unfairly – that your fluctuating income will make it too confusing to manage repaying your credit as well as managing your other financial commitments. Lenders like to see you have a regular income so they have the assurance that you make enough money to repay your borrowing. If you can’t demonstrate that, they may be wary.

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Problems with credit cards

It’s a similar situation when it comes to credit cards, though being self-employed won’t affect you as much as it would if you were trying to get a mortgage or car finance. A number of credit card providers won’t accept you if your income varies from month to month. Alternatively, they may require you to earn a minimum yearly income before they accept you for the card.

While this means some of the best-deal credit cards will be out your reach, that doesn’t mean that getting a credit card will be completely off-limits just because you’re self-employed. But you might have to be willing to take a card with a higher APR or shorter interest-free period. If you’re only going to use it to borrow small amounts that you repay in full each time though, that shouldn’t be too much of a concern.

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Finding a deal

Have a look on a credit card comparison website to find out what the best deals are for you. It’s not a simple case of saying there’s one card that’s right for all self-employed people or small business owners – it depends on your own individual situation and your unique credit history.

Your bank might be able to offer you a good deal if you open a specific account, or you might be able to get a better card if you can demonstrate a history of managing credit well. Some credit card providers offer credit cards specifically for business use, so it might be worth seeing if any of these are suitable for you if you’re looking to use the card for work-related purposes.

Want to know more? Read part 2 of our guide here.

Know if you're accepted before you apply with QuickCheck

  • Get credit - up to £1,500
  • QuickCheck won’t affect your credit rating
  • Get a fast response in 60 seconds

34.9% APR Representative (variable)
Intelligent Lending Ltd (Credit Broker). Capital One is the exclusive lender

Check Now