Applicants face various hurdles when it comes to a loan with no income. If the bank declines, there are also two alternatives that are more suitable for most borrowers. In some cases, the employment office also helps.
It is a loan with no income
If you want to take out a loan from a bank, you have to provide numerous details and provide various types of evidence. Almost all information basically serves to answer only one question:
Will the applicant repay the loan in full and on time?
And here the income plays the biggest role.
Clearly, those who have a lot of money at their disposal each month have fewer problems repaying a loan than a person with little income – or none at all. Therefore, the lower the income, the lower the chances of getting funding. If you cannot prove an income, you basically have no chance of bank financing. The credit houses do not accept collateral such as a car or an apartment with a simple personal loan.
There are these options
First, consider: If the bank refuses a loan request, there is a good reason for it. And you shouldn’t just ignore this reason! Act carefully! Money houses are completely emotionless in their decisions and rely solely on facts and figures. And if these speak against the approval of funding, the applicant should check whether it is not better to defer the loan until further notice – in your own interest! Those who are burdened with financing that can hardly be repaid with their own financial resources are at risk of falling into debt. If you choose a loan with no income, you can:
- a loan “from private”
- the addition of a second applicant
Credit “from private”
A “private” loan is a financing granted by another private person. The borrower does not borrow the money from a bank (which relies solely on facts and figures – see above), but from another person. If no income can be proven, it does not necessarily have to be an obstacle – although it will of course also be difficult to find a financier here.
You shouldn’t borrow money from friends and acquaintances. If there are problems with the repayment, the friendship is at risk. So there are foreign donors that can be found on the Internet through various portals. Both parties – financiers and borrowers – do not necessarily have to know or get to know each other. The portal handles the processing, in some cases also the credit check.
If there is a credit check on the part of the online portal, there is a high probability that credit will also come into play here. In this case, the approval of a loan is again very unlikely: the lender can decide whether to lend his money or not, but many lenders follow the recommendations of the credit bureaus. Also note: In such a case, loan interest is usually extremely high. After all, the lender wants to be “rewarded” for his risk.
With a second applicant, the chances of approval increase enormously – but only if the second applicant can prove income and only if the loan amount is not too high.
The background: In the case of two applicants, the income of both people is taken into account for funding. If the second person’s income is now sufficient to pay the monthly installments, it does not matter that the first person has no income.
Note: With two borrowers, both people have the same rights and obligations. This applies not only to the receipt of the money, but also to the repayment.
How to improve your credit score credit is the “bottleneck” for a bank loan. In order to improve the credit score (ie the value that credit determines for each borrower), there are a few things to consider.
- Return unused credit cards
- Avoid the overdraft facility
- If possible, pay off current loans
- Pay open bills at z. B. furniture stores, mail order companies etc.
- Avoid further debt through loans or installment purchases
All these measures show credit that you are willing and able to make do with your financial means.
Loan without income from the employment office
Anyone who receives benefits from the employment office can hope for a loan in emergency situations. This is the case when the basic needs of the service recipient are threatened, for example the living area.
For example, if the roof urgently needs to be repaired because rainwater is dripping into the living space, they may approve a loan. The same applies if the local energy supplier threatens to switch off the heating because open heating bills have not been paid. Those looking for a way out of unemployment into self-employment may also be able to hope for a loan.