Is it possible to get a personal loan without any job?

You might be having many wishes, desires, and aims in life. But finance often becomes a constraint to such desires. Here’s when a personal loan comes into the picture. Personal loans are loans that you can get without providing any security. As it is an unsecured loan, lenders follow a strict credit review process before offering loans. They will check your salary, ability to repay debt, credit history, etc. Based on these parameters, they will decide whether they should give you a personal loan or not.

We can say that personal loans are a loan against our income. But is it possible to get a personal loan even if we are unemployed?

It might come as a surprise to you but yes! You can get a personal loan even if you are unemployed. Let’s see how!

Personal Loans Without a Job

The kind of loan you will be given falls under secured loans, government loan schemes for the jobless, and payday loans. Let’s see how you can get a personal loan without a job:

1) Government Loan Schemes for Unemployed

The government has initiated various loan schemes to meet the financial needs of unemployed people. Following are some of the personal loan schemes that you can avail of even if you don’t have a job:

• Pradhan Mantri Rozgar Yojana: This scheme was initiated especially to meet the needs of the unemployed. It focuses on providing financial resources to enable unemployed people to start their own ventures.
• Loan Subsidy For Unemployed: The Tamil Nadu government initiated a scheme called New Entrepreneur and Enterprise Development Scheme (NEEDS). The government provides a 25% subsidy on loans given to graduate unemployed youths.
• Agricultural Loan For The Unemployed: The government has collaborations with various banks to provide agricultural loans to the unemployed. This loan can be utilised for any agricultural project.

You should also check out other central and state government schemes that can help you get personal loans. Contact your nearest bank or Piramal Finance for more information about any such scheme.

2) Loan Against Rent And Interest Income

For availing of personal loans, it is important that you have a steady source of income. Even if you don’t have a job but are earning good rental income or interest income, then banks may grant you a personal loan. These incomes are well considered by the bank for giving you personal loans. Also, other sources of passive income can be considered for getting the personal loan sanctioned.

3) Personal Loan Against Assets

While personal loans are unsecured in nature, you can insist on a secured personal loan by providing any security. Banks can accept the security and give you a personal loan. While granting the loan, the bank will ask you for security against the loan. The bank will seize this amount if you don’t repay the loan as promised. That is why they require security before making loans.

In your case, since you don’t have a steady source of income but have fixed deposits, this can work well as security. Your lending bank will give you about 60—80% of the value of your fixed deposit as a loan. The rest of your fixed deposit can continue to earn interest as before.

For example, say you want a loan of Rs. 25,000 against your fixed deposit of Rs. 1 lakh. You can get between Rs. 60,000 and Rs. 80,000 against your fixed deposit. Your requirement, however, is only Rs. 25,000. The bank will deduct the loan amount from your deposit and let it continue to earn you money for the rest of its tenure.

You can also use other assets to avail of personal loans like personal loan against property, gold, securities etc. to avail of such loans.

How to Repay the Loan

Typically, the duration of a personal loan is 12—60 months. You are allowed to repay your loan according to your capacity. However, you will need to fix a figure that you can conveniently repay each month during the tenure of the loan.

Use your bank’s personal loan EMI calculator to determine the amount you should pay each month. You just need to enter the personal loan amount, tenure and personal loan interest rate. You will get to know the exact amount of personal loan EMI that you will have to pay for your personal loan.

Eligibility Criteria for a Personal Loan

Your bank will decide to give you a loan depending on various criteria. These are:

• Your credit rating
• Your tenure as a customer with the bank
• Whether your repayments in the past have been regular and complete

Risks of Taking Out a Loan When Unemployed

Think well before you take out a personal loan if you don’t have a job. After all, you have no steady source of income right now. Once the bank offers you the loan, it will expect to receive the monthly instalments you promised to make. In case you miss out on personal loan EMIs, then the following consequences can follow:

You Could Face Financial Problems

The fact that you want a loan implies that you have a definite repayment plan. If you do not pay each month as you promised, you can have many financial problems. So, think wisely before opting for a loan.

Also, you can work for a few hours a day online or offline and create a source of income equal to your instalment.  

You Could Lose Your Security

By not paying your instalments each month, you could lose your security. Additionally, you will have to pay extra interest.

Your Credit Score Could Be Harmed

Late payments or irregular instalments could hurt your credit score, so be very careful of paying by the date you promised. Also, pay the promised amount each month.

Conclusion

Aren’t you relieved that you can get a bank loan even though you don’t have a job? You must be. Now all you have to do is to check if you can get a personal loan through any of the above 3 ways.

For more help in other aspects of personal finance, check out the Piramal Finance website www.piramalfinance.com. Piramal Finance is a leading financial services company in India. It deals in personal loans, housing loans, and other related financial services. Get onto this site and learn all you need to know to be financially aware.