Can You Get a Personal Loan if You’re Unemployed?
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Few things are more stressful than being unemployed. And even though you know it’s not a permanent situation, you probably have a lot on your mind, including your finances. You may even be wondering whether you’re eligible for a personal loan to get you through. Here, we’ll show you how it’s possible to get a personal loan while unemployed, and help you decide if it’s the right move for you.
Getting a loan while unemployed
Your ability to get a personal loan does not depend on your employment status, although it may seem so at first. Here’s how to get a loan while you’re out of work:
How to qualify for a personal loan while unemployed
The income you use to repay the loan debt does not have to come from an employer. The best personal loan lenders understand that everyone’s situation is different.
Lenders will consider any of these as income:
- Get unemployment benefits
- Child support
- Disability payments
- Investments like annuities
- Social security
- Rental income
- Regular payments from the settlement
If you don’t have a steady income, ask your lender if you can use something of value as collateral. When you get a loan with collateral, the loan is known as a secured loan and the lender can take this collateral if you are unable to pay. Examples of collateral include:
- the house
- savings account
- Retirement Account
- Something else of value
Personal loans that do not require collateral are known as unsecured loans. With an unsecured loan, the lender can’t take your home, car or other assets if you miss a payment. But getting approved for an unsecured loan is difficult. If you’re struggling to get approved for a loan, find out if your favorite lender offers secured loans.
How can I send you my ID in South Africa?
Please only use the secure links below to upload your documents for verification.
To upload your photo ID now, click here.
To upload address documents now, click here.
We kindly ask that you DO NOT email us your documents.
Doing so is likely to result in delays with processing your transfer as you will be requested to upload your documents again via the secure links mentioned above.
Where can I transfer money to in South Africa?
You can transfer money to 130+ destinations in the world using the payout option most convenient for your recipient (eg. as mobile money transfer, cash pickup, bank transfer, airtime top-up etc.). Please refer to our Send To pages for more information.
General advice for international money transfers
1. Learn how exchange rates work (and how to find the best one). One way money transfer providers make money is through exchange rate markups. Most transfer providers will not give you the same exchange rates as you would find on currency exchange platforms like Bloomberg.com or Reuters.com. Those sites only tell you the value of one currency relative to another, but it’s a helpful starting point to know what the best rate looks like at the minute.
When you check exchange rates for international transfers with services like Western Union, focus on the exchange rate markup by looking at the foreign currency amount. The higher it is, the lower the markup will be and the more money your recipient will get.
2. Compare total transfer costs across multiple providers. There are two types of costs: upfront fees and exchange rate markups (see above). Find the provider with the lowest fees with the best exchange rate you can get. Online nonbank providers generally offer cheaper transfers than banks.
3. Avoid paying with credit cards. That’s an option for some providers, but there may be more upfront fees and your credit card issuer may face costs like interest and cash advance fees. A transfer paid through a bank account is a much cheaper (and much slower) transfer. If you need to transfer money quickly, use a debit card, which will also incur lower fees than using a credit card.
More strategies to keep banking costs low while traveling
Using money abroad can incur costs, but switching banks isn’t the only way to avoid them. Here’s a breakdown of different approaches and accounts to consider:
While spending money abroad:
Try a multi-currency account: spend and hold different currencies in one account. This option is usually best if you live or work outside the US. for an extended period. Two mainstream providers are financial tech companies Wise and Revolut.
Find a credit card with no foreign transaction fees: While you can use physical cards or mobile wallets for everyday purchases, a travel-friendly credit card can be useful.
When dealing with cash abroad:
Use a debit card with no foreign transaction or ATM fees: This is especially good for cash withdrawals, especially in countries where cash is heavily used. Generally, these debit cards, and the checking accounts they’re linked to, also don’t have foreign transaction fees.
Take advantage of currency exchange services from your bank: For cash you’ll be bringing on your next trip, see if your bank or credit union has this service, which is cheaper than using a kiosk at the airport.
While sending money abroad:
Consider a nonbank money transfer: If you’re sending a wire abroad while staying in the US, companies like Wise and OFX offer stand-alone transfers internationally that have competitive rates and little or no fees.
While managing assets abroad:
Look into private banking: Private banking offers a personalized experience for high-net-worth individuals, which may include overseas considerations.
Open an offshore bank account: If you need help managing international business or investments, or if you’ll be traveling long-term, consider the merits of an offshore bank account.
Why do you need to know my residential status in South Africa?
The South African Reserve Bank uses this information to complete their ‘Balance of Payments’ reporting. World Remit has to collect and share this information with the Reserve Bank as a requirement for processing money transfers from South Africa.
For more information click here.
Is there anything else I need to know in South Africa?
The type of document we require will depend on what we need to clarify.
1. If you are providing photo ID, it needs to include the following:
- Your photograph
- Your full name
- Your full date of birth
- The expiry date (the documents MUST NOT be expired)
The two lines of letters and numbers at the bottom of the document (The MRZ)
2. Please upload a high-quality image. If the image is unclear we may ask you to upload another copy.
3. We need to see the full document including all four corners. If we cannot see the full document we may ask for another copy.
Who can send money to South Africa?
Due to legislation in South Africa, the availability of our services may be limited by your residency status.
You can use our service if you fall into one of the following categories:
- South African citizens
- Permanent residents
- Asylum seekers
- Employees with permanent contract
- Employees with temporary contract or casual labourers
- At this time, we cannot offer our services to tourists, visitors, and students
What can I use a personal loan for?
Personal loans can be used for anything — if you’re in debt, you’ll probably focus on things like:
- Paying a mortgage or rent
- food shopping
- Covers utilities
- Payment for prescriptions
What credit score do I need to get a loan?
In general, you’ll need a score of 580 or higher to qualify for a personal loan (although the credit score required for a personal loan varies by lender and it’s possible to qualify with a lower score).
If you need an emergency loan and don’t have time to improve your credit score, you’re not alone. Look at loans for bad credit. These lenders will have experience working with borrowers with poor credit and will be more likely to approve you for a loan.
How to choose from the best ways to send money internationally
When deciding which provider to use to transfer money internationally, there are a few factors to consider. Here are definitions of money transfer terms and some general advice to help you choose.
Definitions: Money transfer rates
There are three rates that determine how much your money transfer will cost and how much money your recipient will receive.
Exchange Rate: Exchange rate is the value of one currency in relation to another currency. For example, if you are a US If you want to convert dollars to euros, you will check that the U.S. How much is the dollar worth in euros?
Midmarket Rate: The midmarket rate, also called the interbank rate or interbank exchange rate, is the exchange rate that major banks use to swap currencies between themselves.
Exchange rate markup: Most providers use an exchange rate markup when pricing your transfer. In order to make a profit on transfers, they offer customers an exchange rate that is an additional percentage or markup over the midmarket rate.
Example: If the midmarket rate for US dollars to Mexican pesos is 20 pesos per dollar, a 2% exchange rate markup means the provider is giving you 19.6 pesos per dollar. For a $500 transfer with the midmarket rate, you would send 10,000 pesos, but with a 2% markup, you would send 9,800 pesos. The higher the markup, the less your recipient gets in their currency.
How to calculate exchange rate?
The exchange rate shows how much you will get when you sell one currency and buy another. However, there is no single exchange rate – instead, banks and financial service providers can set their own rates, which may indeed include additional fees.
The best rate to use as a benchmark is the mid-market exchange rate for your currency pair. You can find this from a Google search or by using a reputable online currency converter. This is the rate that banks and payment providers receive when they buy the currency themselves. If the rate you’re offered by the provider is different from the mid-market exchange rate, it usually means there’s a markup – an extra fee – being added to it. This can lead to increased costs or your recipient getting less than you expected in the end.
- MoneyGram: Fast delivery, best for personal transfers
- MoneyGram Money Transfer
- On MoneyGram
Coverage from the US: Over 200 countries with over 380,000 locations.
Price: On the high end. Upfront fees for transfers funded through a bank account are low, but fees for other payment methods as well as MoneyGram’s rate markups, which can go over 3%, are high.
Speed: Regardless of payment choice, delivery can be same day, but may be longer depending on banking hours and other factors.
Transfer limits and options: MoneyGram Online has a maximum of $10,000 per transfer and per month but depending on the country you’re sending from, that limit can go up to $15,000 per transfer. It has the advantage of physical locations so that people, especially those without bank accounts, can pay in cash and recipients can withdraw the funds. Its web platform allows you to pay with bank accounts and debit and credit cards.
Customer experience: Support is available via email and live chat (and by phone to report fraud), and fees, rates and other information can be easily found online. Its mobile apps have solid ratings.
Want more details? Read our full MoneyGram review
Western Union: Best for personal transfers, destination countries not offered by other providers
Western Union Money Transfer
Coverage from the US: Over 200 countries with 500,000 locations.
Price: Varies. Fees for transfers up to $1,000 can be as low as $5 (or more, depending on the source of funds and delivery method), but Western Union rate markups range from less than 1% to more than 13%, depending on the destination.
Speed: Same-day delivery is possible when you transfer cash to pickup locations and use a debit or credit card (or pay cash in person), though you pay more for rush. The cheapest transfers require a bank account to send and receive money and can take more than a week for delivery.
Transfer limits and options: Western Union’s website varies its transfer limits by country, such as $5,000 to Mexico and $50,000 to India. As one of the largest transfer providers worldwide, Western Union’s main advantage is its network, especially in providing cash-in-person cash-sending and cash-pickup delivery options.
Customer experience: Phone support and live chat are available 24/7, but the website doesn’t make it easy to compare exchange rates and FAQs aren’t easy to find.
When is the best time to transfer money from India to South Africa?
There is no official best time to send money from India to South Africa and it depends on various factors such as when you need to send money or when you want to receive the funds.
It also depends on various other factors like, when you send money or the fees offered to you by providers or banks.
Should I take a loan while unemployed?
Yes, if you need it — and if the payments won’t add extra stress to your life.
If you can’t make the monthly payments on the loan, find a less stressful way to cover the costs. You’re probably more stressed right now than you’ve ever been in your life, and if adding one more bill adds more stress to your life, take care of yourself by not taking responsibility.
Below, we’ll cover some options that can be less stressful than a loan.
Options for personal loans
Here are some options to check if a personal loan is the best fit for you.
Approach your existing creditors for financial assistance
After the pandemic, people are able to get more financial help from:
- Credit Union
- Credit card issuers
- Utility providers
If you’re struggling to keep up with your bills, call your creditors and explain your situation. They may offer stopped payments, deferment, forbearance, new payment plans, or other forms of financial relief.
How much will it cost to transfer my money from India to South Africa?
To send money from India to South Africa using one of the international money transfer providers in our tables, fees range from 469.52 INR to 2708.06 INR with CurrencyFair (but fees may be higher at the bank). The exact price depends a lot on where you’re sending money, how much you’re sending, how you want to pay, and how you want to receive payment.
Sending money directly to the recipient’s bank account can usually be done fairly cheaply using a specialist service, while traditional bank wire fees can be high. Paying for your transfer by credit card or cash can often mean increased fees.
When you’re sending money internationally, don’t forget that the overall fees you pay may include transfer fees, additional charges factored into the exchange rate used, and third party charges such as cash advance fees from your credit card issuer.
Low interest credit card
If you had a low-interest credit card before you lost your job, check the current interest rate to make sure nothing has changed. If you’re sure you can handle the monthly payments, consider using it as an emergency loan.
Borrow from an investment or retirement account
If you’re in a bind, call your investment or retirement account manager to find out if you can borrow from your account. When you borrow from an investment or retirement account, you don’t have to worry about credit score requirements or interest rates. You’ll give up the interest you could have earned by keeping your money in your retirement account, but it’s a small price to pay for peace of mind and having your bills taken care of.
Family and friends
There’s not a person in our country who has not been impacted in some way by the pandemic. If you have family and friends on solid financial footing, consider asking for a loan to get you through.
You are naturally concerned about your life, family, and finances. If a personal loan can help you through this time without adding additional stress, consider it as a loan option.