Unemployed and Need a Loan? Read on
Posted: Apr 16, 2019
In the financial world borrowing loans when you’re employed isn’t a much tough task. But what about your loan requirements when you’re unemployed or on benefits? Tough, right? But not impossible. This article Introduces you to the arena of loans for unemployed people on benefits. The words below will guide you about your eligibility criteria and the way such loans work. What all are the types of unemployed loans and their pros and cons.
What are Unemployment Loans?
Unemployment loans are loans provided to people who are not in any sort of employment or are surviving on benefits. Such loans are usually expensive but require only a few criteria and documentation.
Unemployed Loan Eligibility
Your age must be 18 plus. Some unemployment loan lender may require your age to be above 25.
You must be a resident of U.K and citizenship is a must criterion.
You must hold a fixed source of income which will assure the lender of your repayment of loans.
As a borrower, the benefits you’re receiving must be at least 26 weeks old.
You should have a legal bank account. This criterion is not a must for all the types of unemployed loans, like doorstep loans.
When going for a guarantor loan, your guarantor must not be bankrupt and should be a citizen of U.K with a homeowner.
For bad credit loans, you must hold a property.
For retired people loan, your age must be 60+ and you must have a permanent resident in U.K
Pros and Cons of Unemployed Loans
Every aspect has some opportunities for you as well as some setbacks and same is the situation with loans for unemployed on benefits. These are-
- You’ll grab financial aid for your requirements (For short period).
- You won’t need to go for lengthy paperwork.
- Income and job will not be a requirement for you.
- APR (annual percentage rates) are very high on such loans.
- There is a lack of security.
- Repayment failure brings you huge destruction's.
- The benefit is only for short term and has more chances of serving setbacks if you fail in any step
Types of Unemployed Loans
Bankruptcy and money shortage comes indiscriminately and regardless of your job position. So, there are many types of unemployed loans build for the people with no job in U.K. These include-
Payday loans- This is a loan you seek when in an urgent need. You will find a lender in less than 15 minutes. You can borrow up to £ 1,000 and repay within 1 month or so.
Guarantor loan- Under this, you need a guarantor who will be held responsible if you fail to repay. You can borrow up to £12, 000 and repay between 1-7 years.
- This loan has least security. In this, lender will provide and receive loan (£100-2500) and interest at your doorstep. You need not have a bank account for such loans.
Unsecured loans-here, you receive loan ( £500-2500) without owning a property. Such loans have no security but a very high APR. Repayment failure will hit hard your credit score.
Bad credit loans- This last for unemployed people with bad credit score. You can still borrow loans(£5000-£1 million) with high APR and strict repayment deadlines.
Students loans- such loans are for students. It provides relaxed repayment period.
Retired people loans- this loan is for retired people. They must hold specific criteria (above mentioned).So, hopefully the above-mentioned bullets and information may help you in securing a loan for yourself. There is still scope for a better life even without employment. Borrow the one that suits you!
Doris Brown writes blogs and articles for the top notching blogging platforms. Reading her articles is indeed about gaining the knowledge particularly of the UK finances. My sole purpose is to provide the right information to the people.