The unemployment rate in the United States is 4.7 percent. While that may not sound like much, this percentage is made up of more than 7.4 million people.
Many people in this position need extra money but assume they don’t qualify for payday loans due to their employment status. While most traditional lenders (i.e. banks and credit unions) may not offer financing, this isn’t always the case for payday lenders.
Keep reading to learn more about what options you may have to get a payday loan, even if you are unemployed.
Getting a Payday Loan while Unemployed: What’s Considered?
If you are not currently employed, it may be possible for you to get a same day payday loan. Lenders will consider giving you one, with approval dependent on if you show it’s possible to make regular payments on time.
Some of the specific criteria the lender will need to review includes:
Your Regular Income
If you are currently unemployed, you still must show you have a regular income, or some source of income to make the loan payments. Alternative income options accepted are discussed below.
Your Credit History
Just like with any other loan, lenders will want to see if you have made payments on time in the past. They may also look at any negative items that appear on your credit report.
Your Credit Score
Keeping a good credit score can be beneficial in this type of situation. Even if you are unemployed, maintaining a good credit score can help you secure a loan during this financially difficult time.
If your credit score is less than stellar, at that point you should consider looking into no credit check loans. These lenders usually only conduct soft credit checks that don’t hurt your credit score, and they weigh your income and ability to pay back more than your credit score in the decision process.
Alternate Income Options for Payday Loan Approval
If you can show an alternate source of income, a lender may approve you for the loan you need. Because you are unemployed, the lender will likely want to review your financial records to verify the source of your income.
The alternative source of income that most payday lenders accept include:
- Government annuity
- Pension fund
- Social Security income
Others may be accepted, as well. Be sure to check with the lender you want to use to find a comprehensive list.
What to Know Before Receiving a Loan While Unemployed
The most important thing you need to understand before you take out a bad credit loan is that you must repay it. Your ability to repay is what lenders consider when reviewing the application you submit.
Whether or not the lender believes you can make the payments is dependent on how much you have requested to borrow and the type of income you can show since you are currently unemployed.
Remember, each lender has unique specifications. Be sure to find out what these are before submitting an application.
Receiving Payday Loans While Unemployed: Yes, It’s Possible
Payday lenders are willing to provide people with a loan if they can prove they can repay it. If you have been putting off seeing payday loans because you don’t have a job, now you know this is an option.
If you are interested in learning more or requesting a loan contact us. You can also visit our website to learn more about unsecured credit cards for people with bad credit.