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Can You Get a Loan Without a Job?

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If you need to get a personal loan while unemployed, you may be able to get approved by demonstrating that you can repay the loan -- even if you don't have a job.

How to get a loan without a job

When you apply for a personal loan, the lender looks at your credit score, your other debt, and your income.

For this article, we'll assume that your credit score meets the lender's minimum standard.

When it comes to your debts and your income, the lender wants to make sure that you have enough money coming in to cover the new loan payment in addition to any other debt payments you already have to make.

For an unsecured loan, your income doesn't necessarily have to come from a job. Your income can be from many different sources. For a secured loan, you can even qualify with no income at all. But if you have no income, you will need assets that you can use as collateral.

Here are the steps you can take if you need to get a personal loan when you don't have a job.

Understand your options

Get familiar with your loan options, because once you start looking for alternative loan types, you'll run into many that are marketed to people with a bad credit score or no credit history. Those are the most expensive types of loans. If that's not your situation, you'll want to separate those choices from more affordable options that fit your situation.

Loan type Who it's best for
Unsecured loan Someone who meets the credit requirements and can document income.
Secured loan Someone who has assets to use as collateral. In the real estate world, this might be referred to as a no income, verified assets (NIVA) loan or a stated income, verified assets (SIVA) loan. A real estate loan is just one variety of secured loan.
No income, no assets (NINA) loan This is typically not a personal loan. It's used to finance real estate that's expected to generate rental income.
Title loan Someone who owns a car and is willing to use it as collateral. Title loans typically have a short loan term and high price. A title loan generally does not require a credit check.
Payday loan or cash advance loan Someone who has a job with a steady paycheck. Payday loans typically have a short loan term and high price. Payday lenders generally don't require a credit check.
Payday Alternative Loan (PAL) Someone with a job who is also a member of a credit union. Payday loan alternatives are short-term loans, but typically longer than payday loans, and cost much less. These loans don't require a credit check.
Family or friends Someone who knows a person with the means and willingness to help out. This is a personal arrangement that you make with someone you know. To protect the relationship, you should document the amount, interest, payment terms, and any penalties. Treat this lender just like any other. Don't neglect to make payments just because the person may be more forgiving than a bank.
Cash advance Someone who has a credit card. Many credit cards allow you to borrow cash. The cash advance credit limit is usually lower than the purchase credit limit. The loan term is whatever length of time it takes you to pay off the balance. Cash advances are almost always subject to a much higher interest rate than purchase, but the rate may still be lower than other types of loans that you can get without a job (like payday loans or title loans).
Cash-out refinance Someone who has a home, equity, and an income source. This loan uses your home as collateral. You borrow more than you currently owe on your mortgage, and you get the difference in cash. Even though this is a secured loan, you'll need to have a source of income to cover the payments.
Home equity line of credit (HELOC) or home equity loan Someone who has equity in their home. This is money you borrow against the equity you have in your home. Even though this is a secured loan, you'll need to have a source of income to cover the payments.
Debt management plan (DMP) Someone who needs to lower their total monthly payment. This isn't a loan, per se, but it may be appropriate if you are struggling to keep up with your debt payments.
A certified credit counseling agency will help you create a 3-to-5-year plan to pay off all your debts with a single payment that may be more affordable than your current combined monthly payments. Creditors might lower your interest rate to help you get through the DMP successfully.
Which type of loan is best for you?

Document your income

Any income you receive could help you qualify for an unsecured loan. You'll have to provide documentation, such as a recent statement. Lenders may consider:

  • Child support
  • Alimony
  • A pension or annuity
  • Disability
  • Social security
  • Dividends
  • Interest
  • Required minimum distributions from your retirement accounts
  • Spouse's income

Being able to document some kind of income could mean the difference between getting an unsecured vs. a secured loan.

Document your assets

If you don't have enough income to qualify for the loan, you might be able to qualify for a secured loan based on your assets instead. Here are examples of assets a lender might consider:

If you plan to use jewelry, artwork, or collector's items as collateral, the lender will require a professional appraisal and may ask for physical possession of the item until the loan is repaid.

Check with your bank

Credit unions and banks usually have secured loan options. Virtually all will consider different income sources for an unsecured loan. Only credit unions offer payday loan alternatives (PALs).

Check online lenders

An online loan is similar to a loan from your local bank. They will usually consider income sources other than employment. Many popular online lenders offer unsecured loans only, but you will find some that specialize in secured loans.

Avoid predatory loans

Title lenders make loans using your vehicle as collateral. Payday loans charge enormous fees. These are considered predatory loans. They are very expensive, and you can end up paying back many times the loan amount.

If you default on a title loan, the lender can take your vehicle (but risking your collateral is true for any secured loan). For some payday loans, you can't miss a payment because the lender will automatically take the money out of your bank account on payday, even if you need it for other expenses.

Choose carefully

Check rates and fees. Depending on your circumstances, not having a job could make you look like a more risky borrower. That could cause them to charge you higher rates and fees for an installment loan.

What to do if you're not approved

If you aren't approved, you can try lowering your loan amount or talking to the lender to find out how you might be able to qualify. Be careful about applying with several lenders, as each application has the potential to damage your credit score. Many lenders offer information based on a soft pull, which doesn't affect your score. Take advantage of that when you can.

If you don't have income or assets, you will have a hard time getting a personal loan. In that case, you will need to re-evaluate your needs and consider other strategies.

Besides asking a family member or friend for a loan, you could also ask someone to be your cosigner. This means you are asking that person to take responsibility for -- and repay -- your debt. You could inadvertently give someone you care about a new financial problem if you are unable to repay your loan.

FAQs

  • Yes. Many personal loan lenders are willing to consider other sources of income. If you don't have income, you may be able to qualify for a loan based on your assets.

  • Check with the lender before you apply. Many lenders will consider income from these sources:

    • Child support
    • Alimony
    • A pension or annuity
    • Disability
    • Social security
    • Dividends
    • Interest
    • Required minimum distributions from your retirement accounts
    • Spouse's income
  • The best place to start is your own bank or credit union. You can also check with online lenders, but you'll need to research which lenders offer loans that are right for your situation. If you have a source of income, most lenders will work with you. If you need to use collateral instead, find a lender that offers secured loans.

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