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Payday Loans When Unemployed: Try These Better Options First

There's a good chance you'll qualify for a payday loan even if you're on unemployment. DebtHammer explains what you need to know and the risks involved.

Steady employment or proof of income is usually a key factor for payday lenders in determining your eligibility for a loan. If you lose your job, you won’t have a regular paycheck. This could make it more difficult to get a payday loan, particularly if you have bad credit. But what if you’re desperate and need fast cash? 

You have a few options. 

Our take

  • You can qualify for a payday loan while on unemployment
  • To be eligible, you have to get at least $500 per month in unemployment
  • Other sources of regular income will also boost qualification odds
  • Payday loans are dangerous: Before you apply, try these other lenders instead

READ MORE: Practical alternatives to payday loans

Yes, you can get a payday loan while on unemployment

Yes, though they may not be as easy to obtain as if you had a steady job. Traditional financial institutions and direct lenders will usually reject loan applications from those who are unemployed. Still, some payday loan lenders will approve unemployed people for payday loans as long as they receive at least $500 per month in unemployment benefits.

However, unemployment payday loans are a bad idea

But the high fees and quick repayment period make payday loans (and title loans) exceptionally expensive. Unless you expect to have a new job (and paycheck) within two weeks, they will only hurt your financial situation.

Nine online lenders that are better than payday loans

LenderBest forMinimum credit scoreLoan amount 
BadCreditLoans.comBest overall A wide array of options$1,000 to $10,000
Personalloans.comExtended lender network600$1,000 to $35,000
CashUSAInstant approvalNone$100 to $10,000
OpploansPersonal serviceNone$500 to $4,000
Grace Loan AdvanceSpeedNone$100 to $35,000
Bills HappenHassle-free assistanceNone$500 to $35,000 
Smartadvances.comSmall loansNone$100 to $3,000
Money WiseWide array of options600$1,000 to $35,000
Money MutualEasy qualificationNone$200 to $5,000

Unemployed and need money? Try these lenders first

The longer repayment terms and lower interest rates make personal loans a better alternative, particularly if you have a good credit score. Unemployment usually isn’t a factor. Approval will be based on any alternative income you have, plus your credit history. 

These nine lenders are lending marketplaces, meaning they aren’t direct lenders. You will complete an application and they will match you with lenders within their network. Cash is usually available within one business day of loan approval. 

Best overall: BadCreditLoans.com

If you don’t match with a lender in BadCreditLoans.com’s network, they will share your loan application with an extended network of third-party networks to help find you a loan.

  • Interest rate: 5.99% to 35.99%
  • Repayment term: 3 to 60 months
  • Time to funding: As fast as the next business day
  • Minimum credit score: None
  • Maximum loan amount: $10,000

Best for its extended lender network: Personalloans.com

Personalloans.com offers personal loans with no hidden fees or upfront costs. There is no obligation. You will be able to review your loan offer before accepting any funds.

  • Interest rate: 5.99% to 35.89%
  • Repayment term: Two to 96 months
  • Time to funding: As fast as the next business day
  • Minimum credit score: 600
  • Maximum loan amount: $35,000

Best for instant approval: CashUSA

CashUSA offers fast, convenient loan requests that can be acquired discreetly online. You can learn whether you’re approved in minutes. 

  • Interest rate:  5.99% and 35.99%
  • Repayment term: 90 days to 72 months
  • Time to funding: As fast as the next business day
  • Minimum credit score: None
  • Maximum loan amount: Up to $10,000

Best for personal service: Opploans

Opploans is an expensive way to borrow, but it’s still less expensive than most payday lenders. However, the longer repayment term means that your interest costs will add up quickly. Use this one if the others won’t work for you.

  • Interest rate: 59% to 160%
  • Repayment term: 9 to 18 months
  • Time to funding: As soon as the same business day
  • Minimum credit score: None
  • Maximum loan amount: Up to $4,000

Best for speed: Grace Loan Advance

“We accept everyone,” Grace Loan Advance’s website says. This may be true, but borrowers must carefully review loan terms from matched lenders because some may tack on additional fees and charges that make the loans more expensive than the promised maximum 35.99% APR.

  • Interest rate: 5.99% to 35.99% 
  • Repayment term: Up to 72 months
  • Time to funding: As soon as the same business day
  • Minimum credit score: None
  • Maximum loan amount: Up to $35,000

Best for hassle-free assistance: Bills Happen

BillsHappen offers an application process that’s quick, secure and entirely online. You don’t have to deal with anyone in person, so there’s no embarrassment if your application is rejected. Approval can be almost instantaneous.

  • Interest rate: 5.99% to 35.99%
  • Repayment term: 60 days to 72 months
  • Time to funding: As soon as the same business day
  • Minimum credit score: None
  • Maximum loan amount: Up to $35,000

Best for small loans: Smartadvances.com

Smartadvances.com offers a short application, a quick approval process and no minimum credit score. 

  • Interest rate: 5.99% to 35.99%
  • Repayment term: 60 days to 72 months
  • Time to funding: As soon as the same business day
  • Minimum credit score: None
  • Maximum loan amount: Up to $20,000

Best for having the most comprehensive array of loan options: MoneyWise

MoneyWise offers installment loans, emergency loans, bad credit loans, and payday loans. You will complete one application and lenders will make loan offers. Checking your loan offers won’t hurt your credit score, so the risk is minimal if you have poor credit. However, you will need to review the loan terms carefully.

  • Interest rate:  Not disclosed
  • Repayment term: Not disclosed
  • Time to funding: As soon as the same business day
  • Minimum credit score: 600
  • Maximum loan amount: Up to $35,000

Best for easy qualification: Money Mutual 

Money Mutual offers personal loans with no minimum credit score requirement, but their network of lenders includes payday lenders, so you will need to carefully review loan terms before you commit to an online loan. They don’t disclose their interest rates, so these could be very expensive loans, and that doesn’t count the additional fees the lenders may charge. 

  • Interest rate: Not disclosed
  • Repayment term: Not disclosed
  • Time to funding: As fast as the next business day
  • Minimum credit score: None
  • Maximum loan amount: Up to $5,000

Pro tip: In some cases, if a lending network can’t match you with a lender, they’ll pass your application off to a third-party lending network. For this reason, you need to review your loan offers very carefully, as some of these loans may be through tribal lenders. Because lenders affiliated with Native American tribes can sidestep state laws restricting interest rates, tribal loans can be very, very expensive. Some APRs are higher than 1,000%.

READ MORE: Debt consolidation loans for borrowers with bad credit

Carefully review your loan offers

Once you’re prequalified with network lenders, you must carefully review the repayment terms, interest rates and fee structure. Origination fees can sometimes be as high as 12% of your total loan amount. Are there late fees, or will your interest rate increase if you pay late? Also, make sure your monthly payment is manageable. You’ll only hurt your financial situation if you take on a loan and can’t afford the payments.

Note that most of these loans will have a soft credit check, even with no minimum credit score requirement.

Most require a checking account and a source of regular income, but that income does not have to be from an employer.

Unemployed borrowers can, for instance, usually include the following as income sources:

  • Spousal allowance
  • Veteran benefits
  • Trust benefits
  • Alimony benefits
  • Child support
  • Dividend payouts
  • Government annuity payments
  • Disability income
  • Pension funds
  • Social Security benefits

Because payday lenders don’t worry about borrowers’ credit histories, the loan is usually approved within hours of application.

READ MORE: What is unsecured debt?

More options if you’re unemployed

If you’re unemployed and your loan application is denied, there are still better options than a payday lender. Try one (or more) of these suggestions instead:

The bottom line

If you’re unemployed, you may still be eligible for a payday loan, as long as you have a regular source of monthly income. However, this won’t be your best option. Don’t turn to a payday lender until you’ve exhausted all of the other options listed. 

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