What to Do When You Need a Personal Loan but Have Bad Credit and No Job

When borrowers have bad credit, they are often advised to look into payday loans that use employment checks. Sometimes, though, borrowers might not have a verifiable employment to turn to. Freelancers, new employees, and the recently unemployed all need cash on hand, and they need alternatives to bad credit personal loans that are not payday loans. Here are some options for those who can’t supply a recent paycheck stub.

Collateral Loans

Collateral loans are a special type of bad credit personal loans. Instead of calling up the borrower’s credit history and evaluating whether or not he or she is a worthwhile risk, the lender receives something from the borrower to hold in trust. For some, lenders will request nothing more than a good faith check for the full amount of the loan to be cashed on the end of the loan. Other lenders will require access to something more valuable, such as a car title, savings bond or CDs that have yet to mature, or a mortgage title. If the borrower fails to pay back the loan, he or she gives up claim to the collateral item. These types of loans are incredibly risky and should be avoided if the borrower has other options.

Unsecured Personal Loans

Another option is an unsecured personal loan. Personal loans are not payday loans, and so they do not need to be paid back within a matter of weeks. This is great for those between jobs, looking to fill the gap until they get hired. Borrowers apply for these loans online, and with no credit check and no employment verification, they can get thousands of dollars transferred to their bank account in minutes. Because there are few guarantees for the lender with these loans, there can be some pretty hefty fees attached. Borrowers may end up paying a great deal more than want, but they are paying for the convenience of instant cash.

Debt Consolidation Loans

Borrowers should also consider debt consolidation loans. These loans are very helpful bad credit personal loans as they are specifically designed to improve the credit of the borrower. Companies and banks will work with the borrower to address the whole of their debt and financial obligations. They will assess the total amount of outstanding debt and then agree to pay each of those debts off for the individual if the individual will commit to paying the company an agreed upon amount. This debt solution can initially impact the borrower’s credit in a negative way, but over the course of several months, as the other debts are paid, the borrower’s credit score will climb and the debts will slowly disappear.

Getting a personal loan with bad credit and no job is not always easy, but it can be done. By selecting one of the above types of loans, borrowers can get the cash they need today while they work on improving their credit score for tomorrow.

256-bit SSL
Safex
Start Your Application It takes less than two minutes to apply!
Testimonials View All
userpic
“I can’t imagine what my life would be like if I didn’t have PickTheLoan.com to provide me with the money I need when times are tough. Their staff is professional and courteous, and they really know their stuff!“
userpic
“PickTheLoan.com is one of the only websites that provides information about cash loans to consumers who are interested in procuring them. I really commend them for their dedication!“
userpic
“Owing money to friends and family is never pleasant. PickTheLoan.com allows you to get the cash you need quickly and without any embarrassment at all—within 24 hours of filling out an application.“
Implications of Late Payment

The lenders within our network have several options available to them if you do not pay your loan on time. Typically, this involves additional charges in the form of interest and finance fees. You can find information about this on your lender’s website, and you should review this information carefully before signing any agreement.

Implications of Non-Payment
  • Financial Implications – If you do not pay off your loan before the scheduled date, you will likely be subjected to additional charges that vary from $15 to $40 for every $100 borrowed. Additional fees may include an average fee of $20 for non-sufficient funds as well as an additional 10% of the principle balance if the loan is more than 15 days past due. Loans of more than $500 may have even higher charges associated with them.
  • Collection Practices – While most our lenders will typically not sue you for the amount owed, nor will they sell your debt to outside collection agencies, they will contact you via email, telephone and even text message in an attempt to collect the money that is due. They must adhere to the guidelines set forth by the Fair Debt Collection Practices Act. These guidelines can be found on the FTC’s website at http://www.ftc.gov/os/statutes/fdcpa/fdcpact.shtm.
  • Impact on Credit Score – Lenders may also report your failure to repay your loan to one or more of the major credit reporting bureaus. This can have a lasting negative impact on your overall credit rating which will not be removed until the loan has been paid in its entirety.
  • Renewal Policy – Some lenders will set you up with automatic loan renewals at the outset of your agreement. This means that any loan that is not repaid on the scheduled date will be renewed with additional interest and fees. The minimum renewal term is 15 days, and you can find out whether or not your lender participates in this practice by visiting its website. Other options that may be available to you include the ability to repay your loan in full or make payments on the principle balance.
Disclosure of Fees Including the APR

The acronym APR stands for Annual Percentage Rate and it refers to the percentage of the loan that would be charged in the form of interest over the course of an entire year. Typically, the APR associated with short term loans varies and is between 260% and 1825%. Though this is higher than other forms of consumer credit, it is still less expensive than the fees associated with overdrawn bank accounts and bounced checks.

APR Comparison Table

How does the APR of a small dollar loan compare to the consequences of being unable to obtain a small dollar loan?

Consider the cost of a $100 extension of credit for 2 days:

Product Type (single repayment) Charge APR
NSF + Bounced Check $45.00 8,212.50%
Overdraft Fee $30.00 5,475.00%
Late Fee $20.00 3,650.00%

How does the APR for a single payment small dollar loan compare to other options?

Compare your options for the cost of $100 extension of credit for 14 days:

Product Type (single repayment) Charge APR
NSF + Bounced Check $45.00 1,173.21%
Overdraft Fee $30.00 782.14%
Late Fee $20.00 521.43%
Small Dollar Loan $10.00 260.71%

APR Calculations

$100.00 Amount Financed, $120.00 Repaid 2 days after the borrowing

Interest earned on last day but not the first, so 2 days earning: Per Diem uncompounded Interest = 3,650.00% per 365 day year = APR

$100.00 Amount Financed, $130.00 Repaid 2 days after the borrowing

Interest earned on last day but not the first, so 2 days earning: Per Diem uncompounded Interest = 5,475.00% per 365 day year = APR

$100.00 Amount Financed, $145.00 Repaid 2 days after the borrowing

Interest earned on last day but not the first, so 2 days earning: Per Diem uncompounded Interest = 8,212.50% per 365 day year = APR

$100.00 Amount Financed, $110.00 Repaid 7 days after the borrowing

Interest earned on last day but not the first, so 7 days earning: Per Diem uncompounded Interest = 521.43% per 365 day year = APR

$100.00 Amount Financed, $110.00 Repaid 14 days after the borrowing

Interest earned on last day but not the first, so 14 days earning: Per Diem uncompounded Interest = 260.71% per 365 day year = APR

$100.00 Amount Financed, $120.00 Repaid 7 days after the borrowing

Interest earned on last day but not the first, so 7 days earning: Per Diem uncompounded Interest = 1,042.86% per 365 day year = APR

$100.00 Amount Financed, $120.00 Repaid 14 days after the borrowing

Interest earned on last day but not the first, so 14 days earning: Per Diem uncompounded Interest = 521.43% per 365 day year = APR

$100.00 Amount Financed, $130.00 Repaid 7 days after the borrowing

Interest earned on last day but not the first, so 7 days earning: Per Diem uncompounded Interest = 1,564.29% per 365 day year = APR

$100.00 Amount Financed, $130.00 Repaid 14 days after the borrowing

Interest earned on last day but not the first, so 14 days earning: Per Diem uncompounded Interest = 782.14% per 365 day year = APR

$100.00 Amount Financed, $135.00 Repaid 7 days after the borrowing

Interest earned on last day but not the first, so 7 days earning: Per Diem uncompounded Interest = 1,825.00% per 365 day year = APR

$100.00 Amount Financed, $135.00 Repaid 14 days after the borrowing

Interest earned on last day but not the first, so 14 days earning: Per Diem uncompounded Interest = 912.50% per 365 day year = APR

$100.00 Amount Financed, $145.00 Repaid 14 days after the borrowing

Interest earned on last day but not the first, so 14 days earning: Per Diem uncompounded Interest = 1,173.21% per 365 day year = APR