Banks and other creditors will usually not grant loans to those who cannot show proof that they are regularly employed. However, the good news is that there are still ways to get a loan even if you are without a job. One of these is by getting a cash advance from your credit card. Hopefully, you haven’t maxed out your card because in a cash advance you borrow money against your credit limit. A huge downside for getting a cash advance is the high fees that come with the transaction which can usually range anywhere from 2 percent to 4 percent of the amount loaned. In addition, interest begins to count the moment you borrow the money.
If you are receiving unemployment benefits, you may be able to get a loan from payday lenders. They just want to be assured that you have money coming in from other sources so you can repay your loan. They may also accept income coming from your disability benefits or from alimony.
Another method of getting a loan without a job is to get a home equity line of credit or HELOC. This would only work, of course, if you have put up enough equity in your home. You can draw from your credit line any time you want to through ATM or check but by the end of the loan term, you must pay off the entire amount or risk getting your home foreclosed. You should think about resorting to this option very carefully since you are putting your home at risk here.
Another option for getting a loan is getting distributions from your 401k. However, you have to keep in mind that this is money you have allocated for your retirement. You’ll be losing on the opportunity to let your nest egg grow if you draw on it before you retire. In addition, you’ll be subject to early withdrawal penalties and taxes. Exhaust all other options before getting money from your retirement savings.
If you have something of value around the house—jewelry, antiques, rare coins—you can also get money from them at the pawnshop. The items are appraised, usually for a much lower value than what you would get for them if you sold them to an interested buyer. If you agree to the amount, the pawnshop would then give that money to you and hold the pawned item in their safekeeping until you have paid the loan amount plus interest. No proof of income or employment is needed at the pawnshop, making this another immediate loan option for those without a job.
While it may be difficult to go to a loved one or friend for a loan, they are often the easiest to go to and often the most understanding of your situation. In most cases, money is lent without interest. However, if you intend to loan money from people you know personally, make it a point to repay the loan as soon as possible (or tell them if you need more time when you can’t). More often than not, borrowing money from family and friends is often the cause of quarrels that ruin relationships. Pay back what you owe, with interest even, so that there will be no strain in your relationship with people close to you.