In 2019, personal loan lenders from the Philippine Banking System reported P1.7 billion in the total value of all consumer loans. That’s the highest number for all years of monitoring. Thanks to easy loans that are now available online, more citizens can borrow the money without a long verification process.
Still, there are concerns related to loans for unemployed people. The majority of banks and private lenders list proof of employment or stable income as the main eligibility criteria. A lot of Filipino are afraid that they can’t apply for a loan. Further, we want to bust this myth.
While it may be more difficult to get free loans for unemployed, some lending groups offer this service. No job loans are real. Let’s talk about them in more detail.
Here’s the simplest definition of a personal loan: the funds one borrows from a bank, a finance organization or a person for individual purposes instead of business ones.
Means, a borrower gets the financial support to pay for any personal needs. They vary greatly, from regular expenses on food or transport to large purchases or renovations to personal investments, and so on. This form of financing is highly popular around the globe and in the Philippines, especially.
Companies often don’t care about your exact goals. If a borrower meets the criteria, he/she will receive the money. However, there may be unique loan types such as car loans, house loans, educational loans, etc. Apart from them, you can use the amount as you wish.
For a bit more info on the concept of loans, check the next sections.
In a nutshell, all loans, including loans for unemployed people with bad credit, work similarly. They feature several stages:
Surely, some things may change. Different lenders have different ways to deliver loans, list different requirements, and conditions. But each loan moves through the mentioned stages, usually. With this info, let’s move to the pros and cons.
As a rule, lenders want to get their money back. That’s why they are cautious about instant loans for unemployed. Even the largest banks don’t want to lose the funds so they run multiple checks of each borrower to ensure that he or she will be able to repay the full sum.
Simultaneously, loan sharks and microfinancing organizations base their revenue on the number of clients, not their reliability. That’s why they have less strict requirements.
Okay, but how a regular person that doesn’t have a job can get a loan? Let’s try to answer and find the best way to get approved.
It’s still possible to find a loan even if you don’t have a job. Banks need certain proofs that borrowers can return loans but they don’t care about the source of income, usually. The help of friends and parents, business revenue, benefits – regardless of the form, banks accept any stable source.
Take a look at alternative income options:
Let’s also talk about offline and online loans for unemployed.
The Philippine Statistics Authority reports that the share of unemployed persons was 5.2% in January 2019. Simultaneously, underemployed persons willing to get more working hours or even an extra job were responsible for 15.6%. In comparison with 2018, both numbers decrease.
For these categories, traditional banks have few options. However, modern instant loans for unemployed from online lenders are widely available. The exact list of people interested in these offers includes:
Yes, we approached the most important part of this guide. While there are numerous no credit check loans for unemployed customers, it’s still a good idea to understand how to improve your chances of being approved.
Hope, the next suggestions will help you. They don’t guarantee 100% approval but they help a lot. Overall, it’s better to follow the recommendations than ignore them. Without further ado, let’s move through the list.
Be sure to prepare at least one of the following papers:
Not only prepare the documents but study them carefully. Sometimes, lenders run interviews with applicants to ensure that all the proofs are legit. You want to know all the info ideally to answer the possible questions. Remember that banks can ask for extra documents.
As we mentioned, a co-guarantor who can repay the loan in case of your bankruptcy increases the approval chances greatly. Of course, look for people you trust. They should have a good credit history, stable employment, and salary. They also will be asked to sign the contract together with you.
In case you can’t find a guarantor, try applying for a secured offer. For this, you will need a valuable asset that will ensure the sum. There are two forms:
Remember that the firm will be able to take your collateral if you fail to repay the loan. Thus, plan the payments carefully and stick to the schedule.
If it’s still impossible to get a loan, what about other ways to cover the expenses?
For example, banks often issue cards that can be useful if you need to pay regularly. Cards are great as you have to return only the money you actually spent. Moreover, there are a lot of 0% offers.
Crowdfunding is another popular option. It helps people to get small money transfers from other people. Moreover, you don’t have to repay a penny! The catch is that people should invest in you so you need to be persuasive. Causes and Classy are popular platforms.
More alternatives to loans include insurance. Governmental and private companies in the Philippines offer protection from forced dismissal. The most popular option is unemployment insurance from SSS. It’s provided as cash benefits to SSS members.
The important takeaway from the guide is based on the idea that banks rarely approve loan applications from unemployed. Instead, microfinance companies issue such loans more often. Check the variants:
In conclusion, let’s take a quick look at how the loan’s payments are calculated. It’s pretty simple to understand. Here are two examples based on real rates of the Philippine companies:
Even unemployed customers can get a loan. The catch is that you have to provide other guarantees like a co-guarantor or collateral. Otherwise, the final conditions will be much worse; with higher rates and shorter terms.
Alternatively, you can opt for non-loaning options. Fundraising, borrowing from friends, employment insurance – there are several viable options for people who need money but can’t provide proofs of regular income.