Is there a loan for the unemployed? A loan is also approved for the unemployed under certain conditions. All tips for approving an unemployment loan at a glance.
Unemployment is a snapshot for many people. It is not easy to get a loan approved by the bank, even if the unemployment benefit is a large amount. In the current legal situation, unemployment benefit is not part of the attachable income. Some conditions must be met in order to receive loan approval from the bank.
Is there a possibility of loan approval for the unemployed?
From the point of view of credit institutions, unemployment is a critical bridging period. The question of whether and to what extent an unemployed person is able to take out a loan must be answered individually. As an unemployed person interested in a loan, it is much easier if there is a business relationship with the bank in advance. In this case, the financial institution can already involve experiences from the time before unemployment. The probability of the loan being approved can have an advantageous effect and the prospective borrower should first contact his house bank.
1) Loan collateral by guarantor or insurance
An unemployed person who receives basic security only gets loan approval from a German bank if he can show a co-applicant or a guarantor. An unemployed guarantor or co-applicant is useless. Here, a regulated attachable income is a prerequisite to increase the chances of an unemployment loan. Endowment life insurance can also be helpful with a loan for the unemployed. It can be used as part of a policy loan. The insurer itself or a separate banking institution can act as the lender.
2) Short-term credit also for the unemployed
So-called short-term loans are an alternative for the unemployed. Suitable for very short-term money problems, people who are not employed can also get a loan approval much more easily here. The advantages are the credit check without a credit bureau entry and the free credit check.
3) Unemployment loans from abroad
Reputable banks at home or abroad do not grant unsecured loans to people who have no income. This also applies to the term “credit without Schufa”. The term refers to loans originating from countries such as Liechtenstein or Switzerland. Schufa is only a purely German company and often foreign banks do not check the Schufa score. When borrowing, there is also no Schufa entry. However, the creditworthiness is also checked here. In the case of a loan for the unemployed, the foreign bank also has certain requirements:
- Proof of loan repayment
- Possibly additional security
- legal age
- Permanent residence in the Federal Republic of Germany
The first two points are different from German credit institutions. The provision of collateral is not sufficient in Germany because a loan must be paid from current income. If the installments are suspended, the unemployment benefit cannot be seized and is, therefore, an obstacle. In the event of unemployment, only rental or interest income is paid as other income for a loan. When receiving unemployment benefit II or Hartz IV, they are counted again and used up to the minimum amount at an earlier or later point in time.
Banks in Switzerland are a bit broader when it comes to safety assessments and types of income. Conversely, a riskier loan can also be repaid with higher interest rates.
4) Credit through the employment office
The Federal Employment Agency also grants an unemployment loan in urgent cases. The cases covered by this are dealt with in several places in SGB II. A loan for accommodation is regulated in Section 22 of the Second Book of the Code of Social Law: Unemployed people who have received basic security benefits are entitled to a loan if, among other things, they need a repair for the house they live in or cannot pay the rental deposit or heating costs. According to § 24 sentences 1, the Federal Employment Agency grants a loan if there is an unavoidable need. Unemployed people who want to become self-employed are regulated in § 16c SGB II for loans for the unemployed.
The unemployment loan is always granted after the individual situation has been checked and should only serve the previously determined reason. These loans are equipped with very favorable conditions: no interest is charged and the monthly installments are based on the solvency of the unemployed.
5) Loans from individuals through credit exchanges
Another option is credit exchanges. Loans are offered here from private to private. However, a credit check is also mandatory here. However, it is doubtful whether the lender will lend money if the repayment is in doubt due to a lack of regular income. The loan request is free and the granting is trustworthy compared to a loan broker who charges a fee upfront. On the Internet, there is the platform auxmoney.com. At auxmoney.com you can borrow and lend money privately. Small amounts from the crowd bring alternative credit options. The internet makes it possible.