You are useful to your family and to the society until you are earning a good income. Yes, it is a bitter truth because no one trusts on an unemployed person and perhaps, everyone wants to maintain a distance from him. Such situation will not bother you until and unless you have savings to manipulate over the expenses. However, it suddenly converts into a horrible situation when a sudden financial expense arises such as ill health, bill payment and many more. What will you do? First thing that comes into your mind is taking help of the friends or relatives, but as already said, everyone wants to keep away from those with no job in hand. They are not selfish but they may have their own financial obligations.
Perhaps, it is the better time to look for the external funding sources. What will be those sources? Indeed, here we are talking about taking loans for unemployedpeople. The direct lending options are more or less useful nowadays and many people are taking advantages of it. The lenders are adopting quite a flexible lending approach and they have made easier to borrow funds without any hassle. Although, banks do provide some respite but they are less flexible to their approach and often deny the loan application if someone has not a good credit score or don’t have the guarantor.
Why Loans are the only Option?
It would be a nice question to ask but when we look around the options available, we can come to the conclusion that loans would be the easiest and fastest way to getting funds. The arrival of the ‘FinTech’ lending has made this possible because everything can be done online without visiting physically at the lender’s office and submitting too many papers. There are some other reasons to apply for the loans:
- Qualifying for the loans is never difficult because the lender posts only general eligibility conditions such as borrowers should be 21 years of age or above, bank account and earning through extra income like rent or freelancing.
- The application procedure is entirely online and it gives borrowers a respite that they can apply from their home or office. As soon as they complete their loan applications, they will get the instant approval and also the fund disbursal.
- One more reason why many people want to apply for the unemployed loans is that they are more keen towards those options where there are less numbers of obligations involved. It may look surprising for you but it is the reality that the direct lenders can accept the loan requests of those jobless persons, who have bad credit score too. Keep an eye on the interest rates please.
Do You Need a Guarantor to Apply?
Since these loans are only for financial emergency and does not require any collateral due to the short amount, there may be a chance that the lenders can ask for the guarantor. It is good for you because it can calm down the interest rates. However, there is one more truth that not everyone has the companion to take his guarantee and later, the application gets rejected to apply for the loans.
For these individuals, the FinTech market does have the option of unemployed loans with no guarantor. Again, these are very small loans and more or less similar to the payday loans. Borrowers can apply directly without looking for any guarantor and they can do so through either lender’s website or sending a text message. There are some lenders, who are also providing the doorstep loan facility to the jobless individuals.
Many unemployed people are also receiving the government benefits and it may become a constraint of not accepted for a loan. Few direct lenders do show some interest in providing the loans for people on benefits, but the interest rates may go slightly higher.
In the Nutshell
Loans are indeed the useful option to survive in vicious circle of unemployment, but at the same time, you should be careful enough while applying. Don’t ask for larger amount than your repay capacity and try to build a credible credit score prior to look for any loan alternative. Some lenders do provide no credit check feature but still having an acceptable credit score has its own benefits. Concentrate on finding a new job and till then loans may control your expenses.