The unpredictability of life can leave you in a position of financial hardship. And during this time, you may hope to be approved for a personal loan but not feel great about your chances of being approved. Can you still be approved for a loan during times of financial hardship, such as unemployment? The short answer is yes. In this article, we will discuss how.
1. Prove Income
If you have a job or other means of income, this will greatly improve your chances of being approved for a loan. However, if you do not have a job you can still be approved. You will simply need to offer a plan to pay back your loan using alternate income, such as social security benefits, disability, child support payments, et cetera. You may also be able to use the income from a spouse or partner to become accepted, even if the income is not yours directly.
2. Use a Co-Signer
Creditors are worried about the risk involved when they give out a loan – they want to feel secure in the fact that they will be repaid. If your circumstances offer a higher amount of risk, such as loss of income or a low credit score, it may behoove you to have someone co-sign on the loan application with you. This way, in the event you are not able to make a payment on your loan, the creditor will feel confident that they will still be paid.
3. Offer Collateral
A secured personal loan is much easier to become approved for during times of financial hardship. This is especially true if your circumstances make you risky to lend to. If you have property, such as land or a vehicle, you may need to offer that up as collateral in order to be approved for your loan. This way, if you were to not be able to pay back your loan, your creditor would keep the collateral to settle your account. A title loan is one example of a secured loan. You would apply for an amount of money for your loan, and the creditor would examine your car to make sure that its worth matched the amount you were asking for. Then, you would simply hand over the title and receive it back once the account was settled.
If you are facing financial hardship, never fear. You have options, and may still be able to receive a personal loan using these tips. Contact a licensed mortgage broker for more help and guidance.