How to Find the Right Loans for Unemployed Borrowers

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Our team at Student Loan Hero works hard to find and recommend products and services that we believe are of high quality and will make a positive impact in your life. We sometimes earn a sales commission or advertising fee when recommending various products and services to you. Similar to when you are being sold any product or service, be sure to read the fine print understand what you are buying, and consult a licensed professional if you have any concerns. Student Loan Hero is not a lender or investment advisor. We are not involved in the loan approval or investment process, nor do we make credit or investment related decisions. The rates and terms listed on our website are estimates and are subject to change at any time. Please do your homework and let us know if you have any questions or concerns.

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For some borrowers, getting a personal loan can be a sticky situation: When you need one the most, you might not have the finances to qualify.

Say you’re out of work, for example, and need a personal loan for emergency expenses. The first question you might ask yourself is, “Do loans for unemployed borrowers even exist?”

Where to find loans for unemployed borrowers

Most reputable personal loan companies consider your debt-to-income (DTI) ratio when quoting you loan offers. Even if you don’t have debt, your DTI will be out of whack if you’re income is close to zero.

Of course, you don’t need a full-time job to have considerable income. That’s where newer online lenders separate themselves from credit unions and banks, which may have stricter requirements.

LendingPoint requires that you have $20,000 in verifiable annual income, but the amount doesn’t necessarily have to come from employment. An older borrower receiving $20,000 in retirement benefits each year could qualify for a personal loan with the lender, for example.

Other top lenders, however, would prefer that you work full time in addition to (or in lieu of) earning a minimum amount. SoFi explained on its website that you must meet one of three conditions to qualify:

  1. Be employed at least part time.
  2. Have a job offer to start within 90 days.
  3. Have “sufficient income” from other sources.

Coincidentally, SoFi also offers unemployment protection to borrowers who lose their jobs. Other lenders, such as Upgrade, have no minimum income standard.

How to decide if you should borrow when you’re unemployed

Although it’s possible to borrow a personal loan without a job, that doesn’t make it a wise decision. Here are some questions you should ask before you sign on the dotted line.

1. Are you looking at an extremely high interest rate?

If you’re unemployed and looking to take out a loan, it’s possible to get suckered into borrowing with a shady lender. Googling “loans for unemployed” could land you with a lender charging APRs north of 200.00%.

If you’ve already started shopping around, be wary of lenders promising you funds in exchanges for high rates and fees.

A higher interest rate is a severe side effect of borrowing a personal loan while unemployed. It’s problematic because the higher your rate, the more expensive your loan. That’s why you should start your search with the best personal loan companies, which offer rates well below 35.00%.

Say you find a job and receive a modest 8.00% interest rate on a $15,000 personal loan from one of these lenders. Your monthly payment on a three-year repayment plan would be $470, according to our personal loan calculator.

Now say you’re unemployed and secure a 15.00% rate on the same loan. Your monthly payment would jump to $520.

An extra $50 per month might not seem like a lot, but you’d shell out about $1,800 more over the loan term.

2. Can you access a cosigner or co-borrower?

Even if you could afford these higher monthly payments without steady work, you should still consider bringing on a cosigner or co-borrower who’s employed and can share the burden of repayment.

You might be able to borrow from a credit union at a lower interest rate, for example, if your co-borrower lives in your household. Just understand that you’d be putting someone else’s finances at risk should your loan repayment go south.

3. Are secured personal loans an option for you?

Say you’re jobless but own a few assets like a car or boat. You could opt for a secured personal loan that requires you to put up collateral for consideration. You would include any available assets within your loan application.

The downside is that your lender could seize your assets if you default on your loan.

Consider alternatives to borrowing if you’re unemployed

Take some time to consider whether a loan is necessary, or if it can wait until you find another job.

If that home renovation isn’t needed for safety reasons, for example, put a pin in it for later. Similarly, you could delay your wedding (or throw a smaller party) until you have more income to support the debt.

Even if you’re confronting an emergency expense, such as a stack of medical bills, a loan might not be the answer. There are others ways to rack up some cash:

  • Fundraise among family, friends, and strangers via websites like YouCaring
  • Cut your spending and set a savings goal.
  • Start a side hustle.

It might be more difficult to ask a family member for help, live modestly for a while, or take on freelance work. But if these alternatives keep you out of the red while you look to make some green, then your effort will pay off.

If borrowing a personal loan makes more sense for your situation, however, strengthen every other aspect of your loan application. You’d be wise to start by increasing your credit score.

Interested in a personal loan?

Here are the top personal loan lenders of 2018!
LenderRates (APR)Loan Amount 
1 Includes AutoPay discount. Important Disclosures for SoFi.

SoFi Disclosures

  1. Personal LoansFixed rates from 6.58% APR to 14.87% APR (with AutoPay). Variable rates from 6.275% APR to 12.575% APR (with AutoPay). SoFi rate ranges are current as of July 16, 2018 and are subject to change without notice. Not all rates and amounts available in all states. See Personal Loan eligibility details. Not all applicants qualify for the lowest rate. If approved for a loan, to qualify for the lowest rate, you must have a responsible financial history and meet other conditions. Your actual rate will be within the range of rates listed above and will depend on a variety of factors, including evaluation of your credit worthiness, years of professional experience, income and other factors. See APR examples and terms. Interest rates on variable rate loans are capped at 14.95%. Lowest variable rate of 6.275% APR assumes current 1-month LIBOR rate of 2.10% plus 4.175% margin minus 0.25% AutoPay discount. For the SoFi variable rate loan, the 1-month LIBOR index will adjust monthly and the loan payment will be re-amortized and may change monthly. APRs for variable rate loans may increase after origination if the LIBOR index increases. The SoFi 0.25% AutoPay interest rate reduction requires you to agree to make monthly principal and interest payments by an automatic monthly deduction from a savings or checking account. The benefit will discontinue and be lost for periods in which you do not pay by automatic deduction from a savings or checking account.
  2. Terms and Conditions Apply: SOFI RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE. To qualify, a borrower must be a U.S. citizen or permanent resident in an eligible state and meet SoFi’s underwriting requirements. Not all borrowers receive the lowest rate. To qualify for the lowest rate, you must have a responsible financial history and meet other conditions. If approved, your actual rate will be within the range of rates listed above and will depend on a variety of factors, including term of loan, a responsible financial history, years of experience, income and other factors. Rates and Terms are subject to change at anytime without notice and are subject to state restrictions. SoFi refinance loans are private loans and do not have the same repayment options that the federal loan program offers such as Income Based Repayment or Income Contingent Repayment or PAYE. Licensed by the Department of Business Oversight under the California Financing Law License No. 6054612. SoFi loans are originated by SoFi Lending Corp., NMLS # 1121636. (www.nmlsconsumeraccess.org)

2 Important Disclosures for Citizens Bank.

Citizens Bank Disclosures

  • Personal Loan Rate DisclosureFixed interest rates from 6.49% – 19.49% (6.49% – 19.49% APR) based on applicable terms. Lowest rates range from 5.99%-18.99% (5.99%-18.99% APR), are for eligible applicants, require a 3-year repayment term, and include our Loyalty and Automatic Payment Discounts of 0.25 percentage points each, as outlined in the Loyalty Discount and Automatic Payment Discount disclosures. Subject to additional terms and conditions, and rates are subject to change at any time without notice. Such changes will only apply to applications taken after the effective date of change.
  1. Loyalty Discount: The borrower will be eligible for a 0.25 percentage point interest rate reduction on their loan if the borrower has a qualifying account in existence with us at the time the borrower has submitted a completed application authorizing us to review their credit request for the loan. The following are qualifying accounts: any checking account, savings account, money market account, certificate of deposit, automobile loan, home equity loan, home equity line of credit, mortgage, credit card account, student loans or other personal loans owned by Citizens Bank, N.A. Please note, our checking and savings account options are only available in the following states: CT, DE, MA, MI, NH, NJ, NY, OH, PA, RI and VT. This discount will be reflected in the interest rate and Annual Percentage Rate (APR) disclosed in the Truth-In-Lending Disclosure that will be provided to the borrower once the loan is approved. Limit of one Loyalty Discount per loan, and discount will not be applied to prior loans. The Loyalty Discount will remain in effect for the life of the loan.
  2. Automatic Payment Discount: Borrowers will be eligible to receive a 0.25 percentage point interest rate reduction on their Citizens Bank Personal Loan during such time as payments are required to be made and our loan servicer is authorized to automatically deduct payments each month from any bank account the borrower designates. If our loan servicer is unable to successfully withdraw the automatic deductions from the designated account two or more times within any 12-month period, the borrower will no longer be eligible for this discount.

* Important Disclosures for Upgrade Bank.

Upgrade Bank Disclosures

  • Personal Loan Rate DisclosureFixed interest rates from 6.49% – 19.49% (6.49% – 19.49% APR) based on applicable terms. Lowest rates range from 5.99%-18.99% (5.99%-18.99% APR), are for eligible applicants, require a 3-year repayment term, and include our Loyalty and Automatic Payment Discounts of 0.25 percentage points each, as outlined in the Loyalty Discount and Automatic Payment Discount disclosures. Subject to additional terms and conditions, and rates are subject to change at any time without notice. Such changes will only apply to applications taken after the effective date of change.
  1. Loyalty Discount: The borrower will be eligible for a 0.25 percentage point interest rate reduction on their loan if the borrower has a qualifying account in existence with us at the time the borrower has submitted a completed application authorizing us to review their credit request for the loan. The following are qualifying accounts: any checking account, savings account, money market account, certificate of deposit, automobile loan, home equity loan, home equity line of credit, mortgage, credit card account, student loans or other personal loans owned by Citizens Bank, N.A. Please note, our checking and savings account options are only available in the following states: CT, DE, MA, MI, NH, NJ, NY, OH, PA, RI and VT. This discount will be reflected in the interest rate and Annual Percentage Rate (APR) disclosed in the Truth-In-Lending Disclosure that will be provided to the borrower once the loan is approved. Limit of one Loyalty Discount per loan, and discount will not be applied to prior loans. The Loyalty Discount will remain in effect for the life of the loan.
  2. Automatic Payment Discount: Borrowers will be eligible to receive a 0.25 percentage point interest rate reduction on their Citizens Bank Personal Loan during such time as payments are required to be made and our loan servicer is authorized to automatically deduct payments each month from any bank account the borrower designates. If our loan servicer is unable to successfully withdraw the automatic deductions from the designated account two or more times within any 12-month period, the borrower will no longer be eligible for this discount.
7.73% – 29.99%$1,000 - $50,000
Check rate nowon SLH's secure site
6.28% – 14.87%1$5,000 - $100,000
Check rate nowon SLH's secure site
6.87% – 35.97%*$1,000 - $50,000Visit Upgrade
8.00% – 25.00%$5,000 - $35,000
Check rate nowon SLH's secure site
4.99% – 29.99%$10,000 - $35,000Visit FreedomPlus
5.99% – 18.99%2$5,000 - $50,000Visit Citizens
15.49% – 34.49%$2,000 - $25,000Visit LendingPoint
5.99% – 35.89%$1,000 - $40,000Visit LendingClub
5.49% – 18.24%$5,000 - $75,000Visit Earnest
9.95% – 35.99%$2,000 - $35,000Visit Avant
Our team at Student Loan Hero works hard to find and recommend products and services that we believe are of high quality and will make a positive impact in your life. We sometimes earn a sales commission or advertising fee when recommending various products and services to you. Similar to when you are being sold any product or service, be sure to read the fine print understand what you are buying, and consult a licensed professional if you have any concerns. Student Loan Hero is not a lender or investment advisor. We are not involved in the loan approval or investment process, nor do we make credit or investment related decisions. The rates and terms listed on our website are estimates and are subject to change at any time. Please do your homework and let us know if you have any questions or concerns.