To get a loan from a bank, you have to meet the credit check criteria. In addition to a positive credit bureau, this also includes an indefinite permanent employment and a regular income, which must be well above the seizure limit. Unemployed people do not fulfill these requirements for a loan. The unemployment benefit as security alone is not enough. Therefore, reputable banks and lenders will not approve installment credit for the unemployed.
Guarantor for an installment loan for the unemployed
If an unemployed person can name a guarantor for the loan who fulfills certain conditions, an installment loan can be granted for the unemployed. Among other things, the guarantor must have a correspondingly high income, with which he is able to take over the repayment of the loan in case of need.
Alternatives for a loan
If there is no guarantor, so that banks do not grant a installment loan for the unemployed, one can alternatively access a capital life insurance, provided that this is available and has a minimum surrender value of over 5,000 USD. This life insurance can be sold or borrowed from the insurer. This will get you money without having to take a loan.
Another alternative to bridging a financial bottleneck if an installment loan for the unemployed is not approved by the bank is a private loan from friends or family. However, it is important to consider the purpose for which the private loan is to be used and whether this acquisition can not be postponed to a later date when you have a regular income or salary yourself. If it comes to a payment arrears or inability to pay for a private loan, it can quickly lead to trouble and quarrels with family or friends. If a private loan is agreed, it should be determined in writing.
This written agreement must specify the amount of the private loan granted, the duration of the repayment and the repayment installments.
In addition to a third-party guarantee, a private loan or the life insurance loan, you can also bridge financial bottlenecks by putting valuables in a pawnshop. Here you can exchange assets such as jewelry, hi-fi, TV, mobile phones or computers for money. The valuables can also be triggered against the payment of money within a period agreed with the pawnshop. However, one must take into account that the valuables are sold on auctions to third parties, if they are not triggered again within the time limit. The time limits for the release of valuables at the pawn shop are usually around three months.
Conclusion on the installment loan for the unemployed
In principle, no installment loan should be taken out for unemployed persons during unemployment because this is not conducive to the financial situation. If the purchase or purpose for which the installment loan is to be used for the unemployed is so urgent that it can not be postponed, one should first check whether there are any guarantors and, if so, whether one can still afford the repayment of the loan alone, The examination by an expenditure and revenue plan with regard to the ability to pay for the repayment also applies if one uses a private loan in the family or circle of acquaintances.