One minute, your life may be going so well, and you may feel financially stable. The next minute, you are so pushed against the wall and in need of a cash loan. It could be a medical expense or bills you hadn’t even thought about.
Such unexpected expenses pop up suddenly out of the blue making your budget plan to fall apart. Nowadays, it only takes a small thing to blow your budget out of the water.
Cash loans for unemployed Australians
If you are unemployed, things can go wrong real quick. You might find yourself stressed, in a panic, and desperate to get your hands on some money.
If this happens to you, you can take a loan and handle the situation. Later, you can slowly settle the loan, depending on the loan terms.
All you need to do is find a lender that offers cash loans for the unemployed. While it is not easy, you may be in luck. There are a few lenders in Australia that provide loans to the unemployed as long as you earn a regular income.
Most of the financial institutions, such as banks, however, do not easily give loans to unemployed people. Withal, that shouldn’t discourage you. The few that do might charge interest at ridiculous rates, therefore, make a comparison before settling on a lender.
In this article, we will show you your borrowing options, how you can get a loan, and everything you need to know about getting a loan.
Read on and find out if you meet the eligibility criteria if you are unemployed.
Do loans for unemployed Australians exist?
This is perhaps the commonly asked question by most people. And the answer is, yes!
You can get a loan if you are unemployed in Australia. However, you must be earning some income. The income will act as a sort of guarantee that you will be able to repay your loan.
Centrelink payments do count as income to most lenders. Some lenders, though, may fail to regard the payments as regular income. In such a case, you can alternatively borrow the loan as long as you have an income-generating asset.
For instance, if you are unemployed but do get some money from an investment such as property or business, you can still be eligible.
Fast cash loans for unemployed people
If you are wondering, these are loans that you can apply for should you require some quick cash. They can save you from a terrible situation. Most of them can be applied online. You don’t have to get up from the couch and stand in a long queue waiting for your turn.
Filling the online application form is simple, and you can easily do it from the comfort of your home.
Uses of fast cash loans
There, really, is no limitation to how and what you can spend the loan on. Lenders do understand people face different financial snags. As such, they don’t limit you on what you can use the loan for.
Your reasons for applying for the cash loan may differ from another person’s. Life is full of surprises and serves different plates for each person.
The bottom line, however, is that you need some money to deal with that emergency.
The emergency could be fixing your blown car engine, covering an unexpected medical bill for your family member, paying university fees, repairs and renovation of your house, or purchasing home appliances.
Of course, these aren’t the only reasons that can justify a loan application. Don’t feel left out if your reasons for wanting a loan don’t appear on our list. Our list is just but a mention of the common uses of cash loans.
After all, unemployed Australians don’t face the same problems or cover the same expenses.
How much can I borrow if I’m unemployed?
Several factors play a role in the amount you can borrow. These factors include:
- The amount of regular income you earn
- Alternative income amount if you don’t get steady income
- The regularity of your earning
- Your day to day expenses
As mentioned before, borrowing a loan if you are unemployed is an uphill task. For this reason, you can use a lender- finder service provider to help you get a lender.
Lender-finder service providers can be handy in linking you to a lender willing to offer you a loan even if you are not employed.
These providers can only do so much in helping you get a lender. Afterward, loan approval will solely be determined by the lender. Different lenders have varying assessment and approval criteria, but we hope through our guide, you can get that loan.
Some loans may need you to attach an asset you own as security.
Getting a loan from the bank if you are unemployed is very hard. Chances are the bank will turn you down. Traditional lenders, such as banks, usually have restrictive eligibility criteria.
For instance, if your income source is Centrelink payments, the bank may reject your application. This is not to say all banks will turn you down. You can try your luck since banks have different policies on loans.
Fast cash loan options
There are different loan options depending on how much you intend to borrow. You can either get a secured loan such as large amount loans or an unsecured loan like small amount loans.
Small unsecured loans range from $300 and are capped at $2,000. Medium secured loans range from $2,001 to around $5,000. Any loan amount exceeding $5,000 is considered a large secured loan.
Do note that these loans have varying interest rates and additional charges.
Factors to consider before applying for a loan
Applying for a loan is a big deal. Lenders and banks might not be open with this because it is bad for business.
Let’s put it this way; if the lender tells you everything about borrowing a loan, you might change your mind. In case you change your mind, the lender will lose a client. Losing a client is bad for business because the lenders won’t get the interest and fees they would if you took the loan.
Before applying for a loan, take some time to mull over factors such as:
1. Your ability to repay the loan
Biting more than you can swallow will literally choke you. Similarly, if you apply for a loan, you can’t be able to settle, you will be wrecked. You might find yourself in a situation worse than you were in.
Among the first things lenders check if you are unemployed, is the ability to repay that loan. Keep in mind that the amount you can borrow mainly depends on how much you regularly earn.
Lenders do a lot to ensure that they provide you with a loan well within your limits. If you apply for a loan that exceeds your income earning, it will be hard for the lender to approve your application.
Avoid a loan amount that will have you straining to repay and only borrow an amount you can pay back hassle-free.
2. The loan requirements
Before applying for any loan, you have to be aware of the requirements. Also, you have to check if you are eligible and meet those requirements.
It will be a waste of time and effort to apply for a loan and find out you don’t meet the criteria.
3. Your income source
Often lenders will consider your income source before approving your application. This is because your income source shows how much you can borrow. It also shows your ability to repay the loan you are applying for.
Some lenders may regard welfare payments as income, while others don’t. To be sure about the specific payments which count as income or otherwise, get in touch with the lender directly.
4. Repayment plan
It is wise to have a plan for repaying the loan prior to applying for it. Having a concrete repayment plan beforehand will allow you to handle and manage your finances well so that you are not caught up late on a due repayment.
Getting your loan application approved if you are already paying off another loan is hard.
5. Fee and Interest charged
While comparing your borrowing options and lender, keep in mind the interest and fees that you will be charged on the loans. It is not worth it applying for a loan that has very high-interest rates and charges.
6. Credit score
The credit score is sometimes considered when approving your loan, depending on the lender.
A good credit score increases your chances of getting a loan, while a poor one may disqualify you from a loan. If you have a bad credit history, you can apply for no credit check loans.
It is so easy to make a wrong decision, and it could throw from the frying pan right into the fire. We understand that you need some quick cash, but don’t rush the decision to borrow the loan.
A credit score is used to gauge your creditworthiness. The score is a number derived from the calculation and analysis of information on your credit report.
This information includes:
- Your details
- Credit borrowed as well as the number of credit applications you have made in the past
- Any defaulted or unpaid loan
- Debt agreements
Knowing your credit score
You can check your credit score easily. The common credit reporting bureaus in Australia are Equifax and Experian. These two have different scales.
Generally, a higher score means you are a good borrower, which translates to high chances of getting a loan.
Here is a breakdown of both:
|Excellent||800 – 1,000||833 – 1,200|
|Very Good||700 – 799||726 – 823|
|Good||625 – 699||622 – 725|
|Fair||550 – 624||510 – 621|
|Weak||0 – 549||0 – 509|
If you have a poor credit score, your chances of getting loan approval are low. You can, however, apply for a no credit check loan.
No credit check loans
With no credit check loan, your credit history is not factored in when reviewing your application. In other cases, it may be factored but with a little weight attached to it.
No credit check loans provide you with various options. Each loan option has different repayment terms, interest, and risk level.
In Australia, the no credit check loan options are payday and personal loans.
Of the two, payday has high interest and other payable fees. They also have a short repayment period. Personal loans have softer terms and manageable interest rates.
General application procedure
The application procedure depends on the lender. Here is a basic guide, although it may slightly vary depending on your lender.
To qualify for any loan, you have to be:
- 18 years or more
- An Australian citizen or permanent resident
If you are not a resident, you will need a visa. The loan you apply for should also have a repayment period that is within your visa validity period.
- Receiving a regular income for the past 90 days
- Easily reachable through the email or phone
The application procedure is easier than it sounds.
Visit the lender’s website (if you are applying online) and fill in the application form required, including MyGov account details, if you get Centrelink payments.
Submit the form and relax as your application is being processed. It usually takes a short time to get your answer. If successful, you will be provided with a digital contract. After signing the contract, the loan amount will be deposited into your bank account.
Fund transfer time
The funds might take different timeframes to be available in your account. This depends on your bank and its operating hours.
It rarely takes more than one business day to have the funds in your account.
Other times you can apply for the loan in the morning, and if successful, you will receive the funds before evening on the same day.
Lenders prefer a repayment plan that is in line without your payment dates. This way, the lender will automatically deduct the due loan amount until the loan is settled.
Don’t worry; you will get an alert, so you are not caught unaware.
How to increase your chances of approval
You can try applying for the loan with your partner or relative to better your chances of getting the loan. You can even get lucky and get a more significant loan amount. The partner or family member can act as a guarantor, or it could be a joint application.
Just because you are unemployed doesn’t mean you are at the end of the road. You still have a loan option to help get yourself out of that tricky situation.
However, be careful when making this decision and weigh the available options carefully before settling on the best.