Compare personal loans for part-time employees

Am I considered a part-time employee?

With no official definition for what lenders consider a part-time employee, generally speaking, a part-time employee is someone who works less than 40 hours a week. And that’s a pretty big range: it can be someone who works 10 hours a week or someone who works 39. Both are considered part-time employees in a lender’s eyes.

Part-time employees typically work on contracts and bill their employers by the hour. They also might not be able to take advantage of benefits that full-time employees enjoy, like health insurance. If you aren’t salaried and work less than 40 hours a week, then it’s likely you’re a part-time employee.

How to get a loan as a part-time employee

Part-time employees follow the same loan application process as any other borrower. The only difference is that you may be required to submit more documentation if you aren’t on a company’s payroll — such as tax returns and bank statements. Here’s what to do before you apply:

• Check the lender’s income minimum. Most lenders require you to make at least $24,000 a year to qualify for a loan — or more if you apply for a larger loan amount.
• Pay down your debts. Lenders care more about how much money you have available after bills than your income, which they measure by calculating your debt-to-income ratio. Consider paying down your credit cards and other accounts to keep this number low.
• Stick with your employer. The longer you’ve been employed, the more stable your finances will appear to a lender, even if you’re only doing part-time work.
• Sign up for direct deposit. Along with physical pay stubs, this will be a way for lenders to verify your income through your bank account. Stable part-time work will look good to a potential lender.
• Get in touch with the lender. This is the best way to check everything before submitting your application, and it reduces the risk of rejection if you can identify any other areas that might need improvement.

4 ways to appear less risky to lenders

Although lenders can’t deny you because you’re a part-time lender, they can deny you if you don’t have steady income. Here’s how to make sure your lender considers your income to be consistent enough for approval:

1. Work for a year, then apply. If you’ve been employed at the same place for at least 12 months, you’ll be considered much less of a risk. Better yet, some lenders only need to see three or six months of steady employment when you apply.
2. Get a letter from your employer. It could help your application if you provide a letter from your employer that confirms your employment and future work schedule.
3. Apply with your bank. Your bank will have more concrete evidence of your financial history than your credit file. If this history is positive, you’re more likely to be approved.
4. Consult an accountant. When you apply for personal loans, an accountant can help you keep track of your tax returns, savings and spending. In addition, having an overview of your finances can help you decide if a loan is the right move.

Making your current payments on time, avoiding multiple loan applications and building up your savings can also increase your chances at approval. Lenders will be more comfortable lending to you if you can demonstrate that you have healthy financial habits.

If you’ve just started a new part-time job, consider your options as a new employee.

Bottom line

While not all lenders are willing to work with part-time workers, most care more about the fact that you have a steady income and have a low debt-to-income ratio. Check the minimum rates before you apply for a loan to make sure you’re eligible. If the lender’s terms are unclear, reach out to customer service for a more solid answer.

And if you’d like to learn more about personal loans before you start filling out applications, read up on your options and the common documents you’ll need to apply on our personal loans page.

Written by

Anna Serio

Editor

Anna Serio was a lead editor at Finder, specializing in consumer and business financing. A trusted lending expert and former certified commercial loan officer, Anna's written and edited more than 1,000 articles on Finder to help Americans strengthen their financial literacy. Her expertise and analysis on personal, student, business and car loans has been featured in publications like Business Insider, CNBC and Nasdaq, and has appeared on NBC and KADN. Anna holds an MA in Middle Eastern studies from the American University of Beirut and a BA in Creative Writing from Macaulay Honors College at Hunter College, CUNY. See full bio

Anna's expertise

Anna has written 165 Finder guides across topics including:

• Personal, business, student and car loans
• Building credit
• Paying off debt