Loans For Unemployed People? It Can Happen
Even though you generally need to be currently employed in order to get a loan, there have been cases where people are able to get the loans that they need, even though they are unemployed. Generally, these loans are meant to help them get through the tough transition period that they are going through. It is also important to point out that these are typically small loans.
Also, those that are able to qualify for loans while unemployed are people with excellent credit and that may have some sort of major collateral that they are able to give to the bank. This way, should the person not pay the loan back, the bank has a way to get what is owed to them. They will take the collateral, sell it, and keep the money. This type of loan is called a secure loan and while there are risks to them, they generally come with easier approval terms and they also typically have a lower interest rate. The lower interest rate keeps the monthly payments low for you, which is especially important to those who are not currently working.
Then again, there are those sub-prime lenders that will give a loan to just about anyone. These are loans that you generally want to avoid though because they will cost you more than they are worth. The interest rates are high, there might be a balloon payment due in the very near future that you probably will not be able to pay and they are quick to take legal action against you should you default on your loan. One lender might let three payments go without being paid before taking legal action but a sub-prime lender might move a lot faster.
As you can see, there are indeed options for loans for the unemployed. The thing is though, you really have to look through all of your options and take a close look at all of the fine print. Your financial situation is already in rough waters as it is, the last thing you want to do is to make everything worse. This might even be the time to wonder whether or not you are even in a situation to take on a new loan. You might be struggling but if you cut back to your basic expenses, you might be able to discover that you are able to make it, even though you might not have all of the extras that you were once able to afford. When you are back to work, you will be able to go back to your normal way of living.