The coronavirus pandemic is a global health issue. It affects other aspects of society, particularly the economy and employment sector. The US unemployment rate skyrocketed to 14.7% in April 2020, resulting in 20.5 million jobs lost. The pandemic devastated world economies, which is why loans for people with no job are most relevant.
Can you get a loan with no regular work? What is happening today is historically unprecedented. Thus, people have to be flexible and creative in surviving and thriving in the midst of unemployment and financial insecurity. What do you need to know about no income loans? Will you qualify for loans for unemployed people?
Things to Consider Before Taking Out a Loan While Unemployed
Qualifying for loans for the unemployed is a good opportunity to get the financial assistance you need while in this phase in your life. However, make sure that you are clear about this venture first. There are some crucial things you should consider before you take out unemployment loans.
No job loans may be difficult to come by, especially if you do not have the eligibility to receive one. Honesty is the best first step to take if you are planning to get a loan while not having a job for the moment. Make your own assessment to see if you have the capacity to comply with the full repayment of your loan as agreed. A missed payment means significant damage that will affect your credit score. Moreover, defaulting on loans leave a huge dent on your credit history.
Before you think of the best ways on how to get a personal loan or a cash advance with bad credit, be realistic about your monthly payments. Any small doubt should be a red flag, which tells you to skip the loans altogether. You may also choose to borrow a much lower amount from online loans for the unemployed.
Factors Lenders May Use to Evaluate Your Loan Application
Taking out emergency loans with no job depends on the volume and nature of your sources of income. Lenders that offer loans online may also consider unemployment as the main reason to be cautious. Considering your situation, some lenders may even change their loan offers in various ways, such as:
– Lower loan amounts that you are qualified for.
– Full loan repayment in a shorter time frame.
– High interest rates charges or possible origination fees. They could use them as a way to offset the costs of pursuing payment in case of loan default.
– Required automatic bank account deduction as a mode of payment to reduce missed payments.
How Can I Qualify for a Loan With Alternate Income?
Emergency loans for unemployed may be able to help you go through your financial crisis while looking for another job. One of the options you can choose is to get a loan with alternate income. This happens when you cannot give any proof of employment. Thus, you need to verify other income sources.
You may be able to use unemployment benefits as one part of your income stream. However, its tentative nature means that it is not a reliable source on its own. The following are alternate income sources that lenders may accept:
- Disability income
- Veterans Affairs benefits
- Social Security benefit payments
- Government annuity payments
- Child support or alimony
- Pension funds/retirement benefit payments
- Public assistance
- Regular proceeds from a trust
- Dividend or recurring interest payments
- Income from partner or spouse as long as they are the loan cosigner
There may be other alternative situations that lenders may find acceptable to be able to approve your personal loan while you are unemployed:
- An upcoming inheritance
- The pending sale of investment properties, securities, or real estate
- Pending freelance work contract or employment offer
How to Get a Loan Without a Job and Bad Credit?
Credit score plays a salient role for lenders to assess your eligibility for loan products. Poor credit history makes it even harder for you to secure a personal loan with the desired loan amount. However, you can use your creativity and persistence to take out a personal loan even with a not-so-good credit score. The catch is that you would have to accept a high interest rate if you may qualify.
Higher interest rates are always part of the loan term, especially when you do not have a perfect credit report to show. Moreover, you may need to wait a few months to be able to apply for personal loans without savings, collateral, or a job. You need time to spruce up your credit score to boost your chances of getting qualified for a personal loan.
Take note that a middling score is not possible to convert to an excellent credit score overnight. It will also depend on your starting score, whether you can get extra points to access a better loan term with lower interest rates and fees.
However, there are other financial opportunities available for this case. You can consider applying for a loan specially designed for unemployed people, like a payday loan. As long as you can prove you have a verifiable source of income – you may be eligible.
Another great news is that people with bad credit are eligible too. Payday lenders are more interested in your ability to pay off the loan. They don’t even perform hard credit checks. Keep reading for detailed information on each borrowing option.
Personal loans are one of the types of loans that is more straightforward in terms of its structure. A bank allows you to borrow at a variable or fixed interest rate. There are other types of loans, which can be unsecured or secured. Secured personal loans require collateral in the form of car or mortgage loans, while unsecured ones have none, which is why they require much higher interest rates and fees.
However, it could be more difficult to become eligible unless you have a good credit history. Also, the whole borrowing process might be longer. You may have to wait for a couple of days to get funded. Usually, a bank loan might not be the best solution in an emergency.
Loans for Bad Credit
Having no source of income due to unemployment is a huge blow to your financial capacity and available cash. Moreover, it may also be a cause for you to be unsuccessful in securing a traditional loan. What if you are not eligible for a personal loan? What are the types of loans that you can get as an available alternative?
Check out the following available alternative loans for individuals with a bad credit rating or insufficient bank account savings. Working with bad credit scores has its consequences. This could show in a low loan amount that you can borrow, stringent repayment terms, and stiff requirements to qualify.
1. Payday Loans
A cash advance might be the best option to get fast cash if you are unemployed and urgently need money. The eligibility requirements are simple and don’t require you to provide proof of employment. You only have to prove you can pay off your debt on the due date. You can apply for an amount ranging between $50 and $1000, depending on different factors.
Moreover, if you have a low credit score, you still are eligible. Also, payday lenders perform soft credit checks instead of hard credit checks that might negatively affect your current credit ratings.
2. Loan Application With a Cosigner
Consider reapplying for a loan and enlisting a family member or friend with regular employment or a better credit score. There’s a much higher chance for you to get better personal loans with a higher loan amount. However, take note that if you fail to repay the loan on time, the consequence will be on the other person’s own credit score. The lender may also hold them responsible for the loan repayment or other fees.
3. Credit Cards
Some credit cards allow you to borrow cash at ATMs. This will provide a viable way to receive money even with bad credit. However, you will have to pay back the cash that you borrowed with a much higher interest rate. This will only apply to cash advances and not on regular purchases that people make using their credit cards.
Home Equity Line of Credit is another way to augment your income and help you with money problems due to loss of employment. You can choose this option of borrowing money if you don’t prefer using credit cards. This is a good alternative if you have a bad credit history, have no stable source of income, or may not qualify for personal loans.
HELOC allows homeowners to borrow against their home equity through regular mortgage payments for months or years. It may work like a credit card where borrowing against a set limit is required. Make the monthly repayment with interest and do not default on your HELOC. You can lose your equity as well as your home if you don’t repay the loan on time.
Those who have no credit card, social security, good credit scores, or unemployment benefits can still get the cash they need. Going to the pawnshop can help you with money matters, especially if you are in deep debt due to unemployment. You can access cash by selling items of value, and willing buyers will pay you for them. Online marketplaces may help you raise the financial assistance you need, but regular pawnshop is another financial option to consider.
6. Car Title Loan
Use your car mortgage as collateral if you do not have a credit card or home equity as options for financial income sources. The lender will not ask for a credit score for you to qualify. You only need to own your car outright. This means you do not have any more monthly payment requirements. The lender might provide you with cash if you use your car as loan collateral. Not complying with your monthly payments will entitle the lender to seize your collateral.
Other Ways to Get Money if You Are Unemployed
You need to secure a loan because you do not have a credit card, no benefits, or assistance. It is also true if you would not qualify for financing opportunities that a lender offers because of your bad history or credit. The great news is that you can get the financial support you need. These solutions may apply to individuals who are grappling with bad credit or are rejected by a lender or a bank for not meeting their requirements.
Government Assistance Programs
Skip the credit card and payday lenders when you apply for Government Assistance Programs. Along with the benefits that you can get due to job loss, the government will help you cover your needs and costs of living.
Below are the programs that are good alternates for a loan product that a lender offers to those who lost their jobs.
Supplemental Nutrition Assistance Program – It is a federal nutrition program that the government offers to cover the food costs of qualified applicants. All benefits are accessible via an Electronic Benefits Transfer card, which can be used as a debit or credit card to pay for eligible food items.
Temporary Assistance for Needy Families – This time-limited program will provide qualifying families with their basic needs. The assistance offers range from housing, home energy, food, child care services, and job training, and other necessities that eligible families require.
File for Unemployment
You need not apply for a loan with a particular lender if you are dealing with your debt because you lost your work. One alternate step to pay your credit is by filing for unemployment for you to stay afloat financially. Different states have their own unemployment insurance program that will assess your eligibility. You can apply and check with your state to know more about their qualification criteria.
Sell Items You Don’t Want or Need
Often paying off your credit with a lender is possible with other alternatives, such as selling the items that are no longer of use to you. Some buyers may offer a good price for your item, which will temporarily take the place of your cards, and other means financially.
Take photos of your items for sale and provide the necessary information about your offer. Some of the online marketplaces include Craigslist, eBay, Facebook marketplace, and local web marketplaces.
Consider Applying for a Payday Loan from 12MLoans
12MLoans offer payday borrowing solutions without judging you based on your credit scores or history. Unlike applying with a traditional lender, applying with 12MLoans, you get the opportunity to obtain quick cash, with minimum eligibility requirements.
There are minimum eligibility requirements you need to meet when applying via 12MLoans:
- be at least 18 years old;
- have USA citizenship or permanent residence;
- provide a valid phone number and email address;
- possess an active bank account;
- provide verifiable proof of an income source.
Just for the record, you are not required to have a perfect credit score or provide collateral.
Advantages of Applying Through 12MLoans
+ Payday loans are easy to take out while skipping the stringent standard requirements imposed by traditional credit lenders. You only have to meet the minimum eligibility requirements.
+ All borrowing processes are easy and straightforward. You only have to submit a simple application form, wait for an approval notification, and sign a loan agreement. That’s it!
+ You can get funded as soon as the next business day.
+ You don’t have to overpay for your cash advance, 12MLoans services are free of charge.
Sudden joblessness is one of the major sources of stress, which can gravely affect your health, personal and social relationships, and other aspects of your life. Being unemployed rips you off of the secured life that you once enjoyed. Unfortunately, losing a job seems to be a prevalent problem all around the world today, especially with the onslaught of the coronavirus pandemic.
The good news is that you can stay afloat financially by taking out a loan that will take care of all your credit and monetary obligations. You can get numerous options that will support you and cover expenses while you are finding or transitioning to new employment.
You asked – we answer!
– How do you get a loan if you are unemployed?
You can find many ways of getting some cash that will cover the expenses you need while finding work. For instance, you can opt for loans, that don’t have strict eligibility criteria, while offering low APR.
Other options include enlisting someone to cosign, selling items, or pawning them, using your home or automobile mortgages, among other available prospects.
– Where can you get a loan with no job?
Some lending institutions or companies may deem you eligible to get financial assistance, but it’s important that you understand that you have other alternatives to go too. The government offers federal programs to assist with food and other basic expenses.
– Can you get a loan with no source of income?
Having no salary due to being jobless is not a problem if you can qualify for payday loans. Nevertheless, not all payday loan requests are approved. It is important to research all available solutions. Learn more about how to get a loan if you don’t have a job above.