How To Get a Loan Without a Job

Few situations are more painful than needing some quick cash while you are jobless. Imagine this scenario: you just quit your job to travel around the world with your significant other. Your partner suffers an accident in a foreign country and needs an operation. You need to pay cash upfront for the surgery, which exceeds your bank balance. The only option you can think of is to fly home and somehow get a loan. But will you be able to without a job?

The answer is yes, but your options will not be as plentiful as before. The ideal situation is to get a loan yourself, but if you are denied, you might have to seek a cosigner or even borrow from friends and family. You might be tempted to take out emergency loans with high interest rates, but you should avoid those if at all possible. Let’s go over your options.

The first option is to try to get a loan by yourself, with no one you know involved. Here is where you need to look at the situation from the bank’s perspective. What does the bank care about? The bank cares about getting paid back in full and on time. So when a bank looks at a potential borrower without a job, that can raise some red flags about the borrower’s ability to pay back the loan.

Below are some ways you can reassure a bank that you will repay a personal loan without a job.

You can access money from your home either by monetizing your equity or taking an additional loan against your home. Using your home as an asset makes it a secured loan. Your credit history will also come into play. Regardless of the home’s current value, you can be denied if your credit history and debt-to-income ratio are not in line with the bank’s parameters. But if you want to borrow against your home, you can do it in four ways:

With a cash-out refinance, you exchange your old mortgage for a completely new one, drawing on the equity you have built up over time.

You take out an additional mortgage on your own property, which is known as a second mortgage or home equity loan.

A HELOC, or home equity line of credit, acts as a revolving line of credit based on the equity in your home.

A shared equity agreement is a newer concept on the retail level in home mortgages that allows you to sell pieces of equity in your home to third parties. This is not taking out a loan, but it is a way to access cash and avoid taking out personal and bank loans.

If you have an asset that has value and is relatively liquid, you can borrow against it. This is referred to as a “secured” loan. This could be a car, a boat, art, or some other entity that holds value and is tradeable on the open market.

If you have enough cash in your savings account, the bank may feel comfortable enough to also give you a loan. Even in lieu of a savings account, if you have cash stashed away in a money market account or in a cave (and you can prove it), you might also be able to get a loan.

If you don’t have a job, that doesn’t necessarily mean you don’t have income. You might have a side hustle, or you might have a residual income from a property that you own. For instance, if you rent out an apartment in Manhattan that brings in $4,000 a month, then that’s almost as good a W2 job from the perspective of a bank.

Credit cards are there to give you credit in lieu of cash. You can request a cash advance from a credit card company for the amount you need. Be forewarned, though, that the interest from credit cards can be much more expensive than the interest rates on traditional bank loans, and even more so with a cash advance.

If you aren’t able to go it alone, you might need to involve someone else. In most cases, this will be either friends or family, which can come with a lot of baggage. Although you don’t have to put any of your own assets on the line per se, it’s possible that if you involve someone else, their assets could be on the hook. Here are some of your options.

A cosigner on a personal loan is someone that is going to take the fall if you aren’t able to pay back the loan, at least from a legal perspective. In this case, only you have access to the loan money and are solely responsible for paying it back. Only if you fail to pay your personal loans back will a cosigner be held responsible.

A dual personal loan or joint loan is a loan taken out by two people. This means both people have access to the money and are responsible for paying it back.

It might be time to ask Mom, Dad, Cousin Eduardo, or a very good friend to borrow money. This is not ideal but can be a way to obtain some cash when it is desperately needed, without paying high interest rates.

Payday loans are unsecured loans (loans not secured with collateral) that are offered to people regardless of their credit history or employment status. Due to their sky-high interest rates, some of these payday lenders are right on the border of being considered “predatory lenders.” Congress has passed legislation that caps interest rates for payday lenders and makes it more difficult to charge ridiculously high interest for a payday loan. Avoid these loans and seek a lower-interest personal loan whenever possible.

This depends on why you need the money. If it’s an investment opportunity rather than an emergency, you might want to think twice, according to Derek Sall, financial advisor and founder of Life and My Finances. “There are so many ‘great’ investments out there that just flop,” he says. “By taking a loan out while you’re down on your luck, you’re likely adding insult to injury (or maybe it’s death to injury in this case). When you’re in a bad situation, it’s certainly not time to make any heroic investing moves. Instead, I’d recommend using their spare time to find another job — any job. Just get some money coming in so you can keep surviving.”

Yes, you can get a loan if you don’t work. The interest rate might be high, and you might need to involve someone else or put an asset on the line, but it’s doable. However, if you are going the non-payday loan route and want to go it alone or get a deal with a cosigner, then your credit score comes into play.

This can be difficult for some people who have bankruptcy on their record, according to Adrienne Hines, a bankruptcy attorney in Ohio. Hines says bankruptcy combined with joblessness can make it difficult to build credit. “People who are retired, on fixed incomes, or who are disabled will struggle to rebuild their credit because your credit score complicates earning potential and debt-to-income ratio,” she says. “While people without jobs CAN rebuild their credit after bankruptcy, people who are disabled or retired should ensure their housing is locked down before they file.”

You will need to set up a Cash App account and sign in. Click “borrow,” and you should be given an option for loan amounts up to $200. This loan must be paid back in four weeks, and there is a flat fee of 5% for the loan. If the loan isn’t paid back in four weeks, you could be responsible for late fees.

Yes, but your credit reports and credit scores will also come into play. That being said, you may be able to get a loan with a low interest rate if your debt-to-income ratio is low, even if your credit is not great. In this case, a lender might look at your employment contract and the quality of your employer to decide whether or not to give you an unsecured personal loan.

If you don’t pay back an unsecured loan, then the biggest impact is on your credit score, which could remain low for years. Depending on the size of the loan and the loan terms, you might need to file for bankruptcy if you can’t afford the loan payment.