The decision to take a loan during unemployment is very critical. A cautious eye and a calculative mind are the basic needs to ensure a financial decision that is not regretful. Every loan product may look helpful to you but there can be factors that you may not notice but they should not be the part of the loan deal you pick. If you know about those things in advance, the decision on loans for unemployed can be good. The ‘no job’ days are financially fragile and you may not get a second chance after any mistake.
Following are the aspects that should exist in your unemployed loan offer –
Let us take the above points one by one and get a little deep in the detail –
Long Application Procedures – Application procedure is the very first thing you encounter with. When every single penny counts and when every passing day adds a chapter in mounting debts, it is necessary to get things done faster. If the loan procedure is long and takes time in approval decision and fund disbursal, then give a second thought. Instead of this, look for a lender that takes less or very less time to process the application. However, nowadays online lending provides faster solutions but for an unemployed, the hurdles may be more. A loan that is speedy irrespective of employment status should be the focus of your research.
Very High Interest Rates – Yes, it is a fact that for a lender it is always a risk to lend money to a jobless applicant. Especially in the case of unemployed loans with no guarantor. The rate of interest can be high as this is the only way for the lender to compensate the risk. But, as the new age lenders work on a different approach, you can prove the repayment capacity with your most recent finances. Salary slips of last job and a good credit history, factors like these make you eligible to demand a relaxation in rates. Very high rate of loans give less help and add more burden.
Upfront Fee And Hidden Charges – Many times, you are convinced with the lender and its offer but then upfront fee spoils everything. There should be no upfront fee as it is not a genuine practice of the lending industry. The loan company should not take any such fee from you. Same is the case of hidden charges. Many loan lenders try to grab a huge amount in the name of hidden charges. These things unnecessarily make the obligation heavy and final burden comes on you only. Stay cautious and make sure that any such fee and charges are not the part of your loan deal.
Prepayment Penalty – Unemployment is not a permanent situation. Soon you may get the new job and then the life is back on track again with finances in the good condition. In such situations, you can get the capacity to pay off the complete loan at once that you took during unemployment. A prepayment penalty can be a big hurdle in that. Choose the loan choice with no such charges or penalty. Several specialized lenders do not take this penalty. For instance, the lenders of the doorstep loans for unemployed people do not take any such charge as they take your instalments from your home. There is no charge for home collection of repayments; in that case, you can pay off whole amount in cash on the fixed date of installment.