Emergency loans are available for unemployed persons who are hit by impromptu financial crisis. In life, we are likely to be hit by emergency situations but what makes it difficult and uneasy is when you have no job.
Such circumstances drops your spirit as your thought runs down to how you can get a loan to solve that problem while you are unemployed. The good news here is that, now you can get emergency loans even when you are unemployed.
This article was written to provide you information on how emergency loans for unemployed works and it’s eligibility. Paying home bills, medical bills, children school expenses could hit you unexpectedly. But been unemployed will mean looking the way of getting a loan.
Since you are unemployed, lenders will forgo reviewing your employment history or income. They will focus much on other factors such as good credit score, other source of income collateral, etc.
How emergency loans for unemployed people work
Most often, lenders tend to provide loans to individual who they think can repay on time. Clearly, if you should put yourself into the shoes of a lender, you will realize that you can only grant loans to borrowers who have a good credit score and employment with a stable income. In this situation where the borrower is unemployed, how do you think the lender will feel when giving out loan to such a person? This is to mean that getting a personal loan while you are unemployed is difficult but available.
However, lenders who are willing to provide loans to unemployed persons check your credit score and other details which will include other sources of income (social security, child support, retirement benefits, investments, etc.).
Most importantly, you should research much on such lenders based on their requirements and loan term in order to make the right decision.
Alternative source of income for emergency loans while unemployed
Here are the few source of income lenders could alternatively take into consideration when you are unemployed;
Unemployment benefits – most unemployed person tends to enjoy certain unemployment benefits after they lose their jobs or are laid off. For example, full-time employees use part of their salary to foot employment insurance which later provides them with weekly money when unemployed.
Social Security – Employers pay social security for their full-time employees which later provide income to individuals when go on retirement. This contribution towards SS can help you access to an emergency loan when you are unemployed.
Spouse’s income – At the period where you have no job but your spouse (wife) is employed and working, her income can serve as a means of getting a personal loan. However, to make it easier and simple, she must act as a co-signer.
Child Support – Child support income from government can be an alternative means of earning income that can qualify you for an emergency. Lenders can consider that as an income that can help you repay your loan.
Loans for unemployed people with bad credit
This is however the most difficult aspect of getting a loan while you are unemployed. Lenders access the creditworthiness of borrowers. With this, you should be able to convince your lender that you can repay your loan even with bad credit.
Also, you can apply with a co-signer, apply for a home equity line of credit, and request for a less loan amount.
In conclusion, there are emergency loans for unemployed but understand that it’s not easy. Finding the best lender and loan term is difficult as a borrower.
On the other hand, lender might also find it difficult grant a loan to someone who is unemployed. But there interesting thing is that you are sure to get a loan with good credit score and alternative income.
Thank you reading this piece from Finance in Us. You can also read on other loan applications from our site.