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New York
February 1, 2023
Finance

Are you able to obtain a personal loan while unemployed?

Getting a personal loan requires you to pass a few eligibility criteria, of which being employed is as important condition. However, the need for a personal loan increases the moment you get unemployed. So, is there a way to get a personal loan while you are unemployed? Well, you might try getting a quick loan through a loan app that has simple eligibility and even simpler processing. All you need to have is a proper repayment plan in place to get an instant loan.

There are different ways to get a personal loan even if you are unemployed. You can try availing a secured personal loan against an asset. You can mention your other sources of income apart from the salary. You can also try obtaining a loan against your investments or savings.

Read on to understand the different ways that will help you get a personal loan even if you are unemployed.

What is the income based eligibility criteria for getting a loan?

Lenders prefer lending to people who are employed and have a fixed salary every month. The criteria for an instant loan are usually having a regular salary of about Rs. 15,000 per month, though this amount may differ from lender to lender and borrower to borrower. In addition to this number, the brand of the employer and the stability of their job also play an important role in getting a loan at favorable terms. You will have to submit your salary slips as a proof of income. But in case you don’t have a salary slip, you can still apply for a personal loan.

Today, whether you are a free-lancer, self-employed, professional or independent worker, you can avail a personal loan with ease through a loan app. All you need is a repayment plan to assure the lender that their money is safe.

Important considerations regarding loan repayment you must be careful about:

Any lender would want to be sure of your repayment capability before dispensing the instant loan amount to your account. The more secure they feel about your repayment capacity the better terms they would offer you for your loan. This means you can expect lower interest rates, attractive offers and other interesting features.

However, if you do take a loan while only matching the minimum income criteria, you should follow a few key considerations when you get the loan.

  • Borrow within your limits: A loan should be taken not by home much loan you can get but by how much you can be able to pay off. Many times, the loan eligibility figure may be too high even if you are just about matching the loan eligibility, in such cases, you must be very careful with how much money you are borrowing. Borrow only the amount that you can comfortably repay.
  • Haggle on the processing fee and interest amount: The amount you pay in interest and processing charges is the cost of borrowing money that you pay to the lender. Understandably you want to make sure that you only take a loan which offers lowest interest rated as well as charges lowest possible processing fees. Actually, this is something where a loan app works out to be a much cheaper deal because they always have much lower cost of lending and operational costs compared to conventional lenders. If you do end up having to borrow from conventional lender haggle with them for lower rates until you are satisfied that you got the best deal.
  • Keep a few EMIs worth of money in reserve: It is extremely important to keep money equal to three or four EMIs in reserve when you take a loan. This will allow you to manage things in case of an income disruption. See a missed loan EMI can create a lot of problems. You will be charged late fees for missed payment and extra interest will also be levied. In fact, some conventional lenders had so high late fees and extra interest rate that for one missed EMI you actually ended up paying double the amount to get things back in order. Thankfully this is not case with loan app but still you do not want missed EMIs impacting your credit score so keep some money in reserve at all times.

Conclusion

As said earlier, while any lender will not give money to a person who is unemployed, even if you can find a small job that pays you a decent amount of money or if you can prove that you are self-employed and earning enough to match the lending criteria, you can still get a loan in case of emergency.

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