Basically, it’s a fairly unfair fact: the less money you have, the less likely you are to get a loan, even if you don’t have much money, a loan is only necessary. But banks are companies, and understandably not only for profit, but also simply for the time being that they actually get the money that they lend to the borrower.
Loans without collateral and loans with collateral
It is important to distinguish between loans without collateral and loans with collateral – it is basically impossible for an unemployed person to receive a loan without collateral. Because either you can provide collateral such as a piece of land or a property, insurance or other security for the bank, or just the regular income.
On the other hand, those who are unemployed because there is no need for regular work and the income is generated in other ways, for example from renting and leasing or from invested capital, naturally have better cards – it always depends on the customer’s situation, whether a loan approval is given or not.
If the criteria are restricted, it becomes increasingly difficult: if a person is unemployed and without income and looking for a loan, only collateral remains, as mentioned above, that must be provided so that a loan approval can still be reached – and even then Many banks generally refuse to grant loans in such cases.
Monthly benefits and not a real loan
There is the possibility of a mini-credit from the social welfare office or the employment agency – but it is rather an advance on the next monthly benefits and not a real loan. In addition, such an advance is only granted in exceptional cases if there are plausible reasons.
A fundamental question is of course how sensible it is to borrow if no fixed income is generated – for example, if the loan is needed to start a business, you are not de facto unemployed, but look for a loan for start-ups In these circumstances, the situation of the borrower is assessed differently than if the unemployed simply felt the desire to buy a new car or to go on vacation.