A loan possible despite unemployment?
Unemployment can hit anyone. From one day to the next you lose your job and then you have to see how you make ends meet. However, unemployment is not always the biggest problem. The house must be paid off, you have just bought a new car or there are other payment rates. If you do not have enough money in the bank, you have to take out a loan. But getting a loan is not that easy when you’re unemployed. Many banks refuse a loan because the required credit rating is missing. But you should not be pulled down, because you can also get a loan if you are unemployed.
Unemployment loan – a small hurdle
Especially after the direct onset of unemployment, a loan is very convenient and can help. Thus, a greater financial flexibility is created and the job search is easier without money problems. However, it will not make the banks so easy. They are extremely cautious and unemployment and financing often do not coincide. That’s why banks do not award unemployment loans on principle.
Despite difficult conditions, you should not give up if you really want to take out a loan. Nevertheless, one should also pay attention to the loan conditions as an unemployed person. The interest rate should be as low as possible. Of course you do not have as much choice as a creditworthy party, but that’s no reason to take a bad credit.
Find the right provider
The search for a loan for the unemployed should be targeted and professional. You should also be aware that you can always be disappointed. The offer is not big and in many cases you will be rejected. But that should not stop you. Especially on the Internet you will come across numerous financing offers. However, there are also many black sheep here. Therefore do not strike immediately, but first make a comparison. A comparison is the ideal solution for finding the perfect loan partner.
The comparison should be independent and serious. Only then is it possible to believe in the result. In the modern comparison even unemployment, creditworthiness and Co. can be entered beforehand. Thus, only the results are shown that really meet their own claims.
Of course you could also contact a financing partner. This helps in finding the perfect bank, loan exchange or credit intermediary.
An unemployment loan without private credit
The loans so rarely given to the unemployed have a simple reason. Banks pay attention primarily to the creditworthiness of the customer. If this has a bad credit rating, then no credit will be forgiven. The credit rating is characterized by income. Without own income the credit rating is also negligible. Thus, unemployed people find it difficult to repay the loan. The banks do not want to take that risk.
However, not only the credit rating can make a dash through the bill, but also the private credit.If a negative private credit entry exist, you can immediately forget the credit. Therefore, one should take a loan without private credit information. Especially credit institutions abroad do not require private credit information.
More than 2.8 million people are unemployed, according to the latest labor market figures from the Federal Employment Agency. The number of unreported unemployed people, however, is significantly higher, because the statistics do not include older people over the age of 58, sick unemployed or unemployed people who are pursuing a one-euro job or are in further education. Even people looking for a new job through private employment agencies are not included in the statistics.
When talking about unemployment, it means the work that is lacking to financially support one’s own livelihood. Unemployment arises when in the market economy more people are looking for a job than jobs are offered.
Credit despite unemployment benefits
Every tenth who draws unemployment benefits is also dependent on subsidies, as the unemployment benefits to life are not sufficient. Unemployment benefits are not enough to make the necessary, larger purchases or to fulfill a greater wish. A loan despite unemployment can be the solution for this. However, before deciding on such a loan, it is important to consider the alternatives.
So, for those in greater need, the Employment Agency must grant a loan. For this she is obliged. But if you do not get help here, you should be careful to keep the loan amount as small as possible. If you need extra money quickly, and especially if there are small liquidity bottlenecks, then the path to the pawnshop is well worth it.
The loan is secured only by the respective pledge, the income situation of the borrower is insignificant. If you do not repay the loan to the pawnshop, the deposit will be auctioned off.
Installment or consumer credit
Small installment or consumer loans enjoy great popularity. These are quick and very easy to apply for and just a few days later, the money can be in the account. However, those who are unemployed must expect some difficulties here, because for the banks one counts as unemployed to a risk group. The chances of such a loan fall significantly, because for most credit providers, the income is considered a firm security and at the same time as the basis for the award of the loan.
However, this does not apply to recipients of unemployment benefits because the unemployment benefit is not assessed as income. But some lenders have recognized the problem and have specialized in loans despite unemployment. With these providers, unemployed people have much better chances of obtaining a loan.
Many loan offers, which also provide money for unemployment or over-indebtedness, look at first glance tempting. In advance, however, it should be carefully considered whether a loan is absolutely necessary. Especially in unemployment, you should not give up any further financial burdens.
If there is no prospect of a new job, the repayment of the loan may prove to be almost impossible. For reputable credit providers special conditions apply for the granting of a loan. This includes the income that serves as collateral, the loan can be repaid and the credit rating.
The applicant should not have negative private credit entries. If a negative payment behavior is noted with previous or current loan agreements, then this can lead to the rejection of the credit. The unemployed lack security as a basis for lending, so they need to provide other collateral to increase their chances of getting a loan.
Credit intermediaries have made it their mission to help people in unemployment to get a loan. Such credit intermediaries mediate to the unemployed private banks or investors for the awarding of the money. In most cases such mediation is legitimate and often a suitable investor is found. With such a credit broker, the chances of a reputable loan with the usual conditions are greatest.
But here too, if the supply of credit is too tempting, one should exercise caution. In most cases, high interest rates, high credit costs or other financial burdens, such as the conclusion of a term life insurance must be expected to high premiums or the like.
On credit platforms you will find a variety of providers who are willing to give a loan. These include both private individuals and banks. With unemployment one finds however also here only with offerers, which offer the borrowing also without salary references or private creditauskunft. Such providers usually offer loans in the form of smaller amounts, which can nevertheless help over an emergency situation.
The advantage of such smaller amounts is also that the rates for the repayment are also kept small and you will not get into financial difficulties because of this burden.
The chances of getting a loan despite being unemployed can increase by a co-applicant. The co-applicant has a personal interest in taking up the loan and is regarded as an equal partner in the contract. Like the main applicant, he may decide on the payment and use of the money. However, it is only accepted by the credit provider if it can provide its own income as collateral.
However, if the lead applicant no longer meets his payment obligations to repay the money, a co-applicant must not only be liable for the credit debt, but can also be called upon by the lender immediately.
The chance of being awarded an unemployment loan can also be increased by naming a guarantor. The guarantee is a contract between the guarantor and the bank of a third party. With the guarantee, the guarantor agrees to pay for the liabilities that arise from the borrowing. He thus hedges the claims of the bank against the principal debtor.
It should be noted here that the guarantor is liable with all his assets, so that the guarantee can be seen as a very risky business. If you want to act as a guarantor, you must prove a very good credit rating in addition to a corresponding income.
If you have neither a co-applicant nor a guarantor for borrowing, you may need additional collateral to help you get the loan despite unemployment. Thus, existing collateral, such as a car or a property as well as the assignment of a claim can be accepted as collateral by the bank.
Such collateral, however, is in most cases only of interest to banks if an income above the seizure-free limit can be demonstrated.
If you have fixed capital that generates interest, you can also use this interest income to pay off a loan.