How To Get A Personal Loan If You Are Unemployed

If you lost your job or your income was disrupted in some way because of the pandemic, a personal loan can help make ends meet until your circumstances improve. Even if you don’t have a job, you can get approved for a loan, though you will need good credit and some form of income. Provided you can prove you can pay your monthly bills on time, the lender may be willing to approve you.


Can You Qualify For A Loan If You Have Other Income Sources?

If you are unemployed, you will need to provide evidence of other income sources, which the lender will check and verify. Although unemployment benefits count toward this requirement, they may not be enough to persuade the lender. If you receive money from any of the following sources, make sure you include it on your application:


  • Social Security benefits
  • Pension or other retirement payments
  • Disability
  • Veterans Affairs benefits
  • Alimony or child support
  • Trust fund distributions
  • Government annuity payments
  • Recurring interest or dividends
  • Public assistance
  • Your spouse or partner’s income (only if they co-sign)


Moreover, your lender may approve you if you prove you have a large amount of cash available currently or in the future, such as:


  • An impending inheritance
  • An upcoming real estate, securities, or investment property sale
  • A prospective employment contract or freelance work


What Should You Consider Before Applying For A Loan While Unemployed?

No matter if you’re working or unemployed, you should always be frank with yourself. Can you really pay back the full amount of the loan on the lender’s terms? Will it put you in a more difficult financial situation? Even one late payment can impact your credit, and defaulting can do even more damage. If you’re unsure, rethink your decision to get a loan or borrow a smaller, more manageable sum.


Also, keep in mind that lenders may give you different terms and conditions if your existing income sources aren’t enough. These changes could include:


  • Smaller loan amounts
  • Shorter term limits
  • Higher interest rates and other assorted charges
  • Requiring automatic payments to minimize the possibility of missed payments


Where To Apply For A Personal Loan

Personal loans are unsecured, which means you don’t need to deposit money or an asset as collateral. Most lenders offer personal loans, so your best bet is to contact your current bank or credit union. Since you have a previous relationship, they may be more willing to approve your application.


If you bank with a credit union, these institutions usually have more affordable rates and less credit score restrictions versus banks. Keep in mind that you must be a member before applying for a loan from a credit union.


Peer-to-peer (P2P) lending sites are another option worth considering. These platforms offer fast decisions and are relatively straightforward to use. 


What Should You Do If The Lender Rejects Your Application?

If your lender rejects your application for a personal loan and you’re strapped for cash, these options could help you secure the funds you need.


Get A Cosigner

Ask a close friend or family member whom you trust and who has good credit and a steady job to sign on your loan. It will raise your chances of approval, but if you miss a payment or default on your loan, you risk hurting the cosigner’s credit as well as your own.


Home Equity Line Of Credit (HELOC)

If you own a home and have a fair amount of equity, you could be eligible for a HELOC, which lets you borrow a certain sum against your equity. You repay the amount with interest, but if you default on your loan, the bank will size your home.


Car Title Loan

If you paid off your vehicle, you could put it up as collateral on a secured line of credit. But, like a HELOC, you could lose your car if you miss your payments.


Cash Advance

Most credit cards let you withdraw cash at the bank or ATM. Although this can come in handy when you’re in a jam, be aware that cash advances have a significantly higher interest rate than what you pay for purchases.



You can sell unused or unwanted items online, but if that’s not enough, you can take your more valuable belongings and sell them at a pawnshop.


  • Akin, Jim. “How to Get a Loan If You Don’t Have a Job.” Experian, Experian, 14 Apr. 2020,