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Are There Loans for Unemployed People?

Are there loans for unemployed people? Short answer: Yes. Maybe.

Unemployed people can get a few kinds of loans just as if they had a job, if they have some kind of regular income coming in, such as unemployment, disability or alimony payments. There are a couple other options too.

That doesn’t necessarily mean you should be borrowing money if you’re out of work. But emergencies don’t stop just because you lose your job. I’m assuming you’ve already used your credit cards, or asked your friends and family for loans, because honestly, those will probably be the cheapest ways to get money.

But here are some other ways to get loans for unemployed people:

Borrowing Against your Home or Life Insurance

The answer’s probably going to be no. But if you’re lucky enough to have equity built up in your home, or a whole life insurance policy that’s worth something, and you have unemployment checks or some income coming in, it’s worth a try. Talk to a bank or credit union and see. This’ll probably be close to the cheapest loan you could get if you’re unemployed, but don’t hold your breath.


Short-term installment or payday loans

You don’t necessarily need a payday, to get a payday loan. Some payday loan places will accept proof of unemployment, disability or alimony checks–or any kind of regular income–instead of paychecks. They’re mainly concerned that you can prove money will be arriving into your bank account by the day the loan is due.

Payday loans aren’t cheap, and they’re short term, so it’s good to look for an alternative, but if you need money, you need it.

On-the-Spot Financing

I mean used car lots that advertise “buy here, pay here.” Or appliance stores that say, “no payments till whenever.” Or rent-to-own places. If you absolutely need to buy something and you have some source of income like unemployment, alimony, disability, etc., and your credit is pretty good, you have a chance of getting a loan here.

Don’t be tempted into buying something just because you can get a loan, though. If you can convince someone with better credit to co-sign, you might have a better chance, but you’ll still need to prove at least some income of your own, and the co-signer had better trust you, because if you can’t pay, he or she will have to. That’s a good way to ruin a friendship.

Car title loans

If you’ve paid off your car, or paid it down enough that it’s worth a lot more than you owe, a car title loan is a way to get cash out of it. What’s cool is that you can still drive your car. Nothing changes, nobody can tell anything’s different, except the car title loan company holds onto the title until the loan is paid back.

Car title loan places require a regular income, like payday loan places, but again, some will accept unemployment, disability or alimony checks as proof of a regular income. You can search for a car title loan company online in your area and start the application online, then have the car inspected in person, or there are a few places that will do the whole thing online.

There’s no cost to apply, but you’ll pay a fee as well as interest if you accept the loan. Interest rates are high, but not quite as high as payday loans, and the term of the loan is usually longer. However, if you fail to repay, you can lose your car, so keep that in mind.


Pawnbrokers are another source of loans for unemployed people. Pawn shops are different than title loan places, because here, you do have to give up the item until you pay the loan back. If you have no income coming in at all right now, this may be your best bet.

First, the pawnbroker will estimate the value of whatever you bring in as a lot less than it’s really worth. Then he’ll only offer you a loan for less than half of that. It’s the way they work. You just have to live with it. However, they don’t care about your income, because if you don’t pay back the loan plus interest, or arrange to continue the loan, they keep whatever you left with them to pay off the loan.

The interest varies depending on your state, but is usually less than payday loans, since the pawnbroker is taking no risk. You don’t pay, he sells what you left him. You can search for locations near you online, but this is one kind of loan that isn’t really offered online, at least not in the US. Those crazy Brits have some mail-in online pawnshops, but they’re strange anyway. Oh, and don’t lose the receipt. I could tell you a story about that.

Loans for Retraining

The government offers some loans for unemployed people so they can pay to be retrained with new job skills. There’s some information on the Opportunity.gov website.

So, it’s not hopeless

There are loans for unemployed folks out there. It’s just not easy to find them. And honestly, unless something really bad will happen if you don’t come up with the money, you’re probably better off talking to your creditors and seeing if you can work something out. But that’s easier said than done, sometimes. You can also check out services that help you consolidate or cut your debt and improve your credit score. Or you could just not pay things and get behind for a while, till you find another job. But you need to figure the cost of late fees and things like that, plus the hit to your credit, compared to the cost of a short-term loan to tide you over.

It’s not easy being unemployed. It totally sucks. I wish I could help more, but that’s all I know to tell you right now.

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