Can you get a loan on unemployment?
The short answer here is "it depends." David Hotchner, a payday lending branch manager, states that most lenders aren't thrilled to lend money to people who don't have a steady income. It's risky both for the lender and the borrower. Before accepting a loan request, a lender will examine your income and double-check if you can repay them based on the money you earn and the funds you spend. That's your debt-to-income ratio. However, there are still businesses that count certain types of funds as income. In most cases, these include:
- self-employment income;
- social security or disability benefits;
- investment income;
- alimony or child support;
- unemployment benefits.
In David's experience, very few lenders accept unemployment benefits as an income source. What's more surprising is that many borrowers who don't have a job when they apply for a loan don't even know they can count alternative income sources. When talking about a financial emergency, it can be a deal-breaker. All you need is to look for a legitimate business that accepts alternative income sources, and qualify according to their list of requirements.
If getting financing from payday lenders doesn't work, you can try personal secured loans. Lenders are more likely to accept your loan request by using collateral since it considerably diminishes their risk. In certain scenarios, 1FirstCashAdvance CEO - Latoria Williams claims that you may also obtain an unsecured loan. For example, if you have a credit score over 650 or so, and you are self-employed, with regular income, you may manage to get a loan.
As a field professional, David Hotchner recommends all people who struggle with their monthly payments get help from a financial advisor. If you are often in debt, expert advice will help you prioritize your expenses and reduce borrowing to a minimum. In David's experience, the people who need an emergency loan more than four times a year need to review their finances and change their spending habits.