It becomes quite difficult for a person to meet everyday expenses when he/she is suddenly laid off from the job. In such a situation, unemployment loans can help to meet your everyday expenses.
Types of unemployment loans:
There are 2 types of unemployment loans available to you, namely, secured unemployment loan and unsecured unemployment loan. There 2 types of loans are discussed below.
1. Secured unemployment loan – You can take out a secured loan if you have a valuable asset that can be used as collateral. You can pledge your home or your vehicle if you have a free and clear title to the asset. One of the greatest advantages of obtaining a secured loan is that you may get comparatively low interest rates on such loans. Moreover, it is relatively easier to obtain such a loan even with a bad credit record. However, there is a risk attached to it. You may lose your asset if you’re not able to pay back the loan on time.
2. Unsecured unemployment loan – As the name suggests, you can take out such a loan without pledging any security. However, the interest rates on such loans may be relatively high as there is no collateral that can guarantee the loan repayment. However, many people prefer such loans so as to avoid the risking of assets.
Usually, unemployment loans are offered with easier repayment options. This is because the lenders can understand that you won’t be able to pay back the loan till you find a job. However, if you get a job before the repayment period of the unemployment loan begins, then you can start repaying your loan before the repayment period.
Eligibility criteria to take out the loan:
You need to satisfy certain qualifying factors in order to take out an unemployment loan. They qualifying factors are given below.
• You should be a US citizen
• You should be minimum 18 years of age
• You should have a valid savings or checking account
How to get an unemployment loan online
You can browse through the internet to find unemployment loans online. All you need to do is complete an online application form, where you need to answer some simple questions that give an idea of your financial condition to your lender. You can also submit the required documentation online. The documents that you need to produce may vary from one lender to the other. Upon approval, in most cases, your unemployment loan proceeds get deposited to your bank account within a day.
In times of unemployment, you can also apply for Federal State Unemployment Insurance program that provides benefits to those who are laid off without a fault of their own. This program provides temporary financial assistance to the unemployed workers who can satisfy the eligibility criteria. However, the eligibility requirements may vary from one state to another. Therefore, check your state eligibility requirements before applying for such a financial assistance.