Getting a Loan When You're Unemployed

Being unemployed can put you in a tricky situation financially. It's probably the one time you need to borrow money the most because you don't have a regular income to rely on. However, that lack of income could mean that lenders are more likely to turn down your loan applications. Being out of work doesn't always mean you can't get a loan. It may still be possible to receive unemployed loans, and we're going to show you how.


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Representative 49.7% APR. Representative Example: Amount of credit: £1,200. Interest rate: 0.34% per day for up to 75 days (25.5% (variable) per annum). Representative 49.7% APR (variable). For example, if you borrow £150 for four days, the interest per day would be £0.51 and the total interest would be £2.04 representing four days at £0.51 per day.
Choose Wisely is a trading style of Choose Wisely Limited and is a free to use price comparison website. Choose Wisely Limited is authorised and regulated by the Financial Conduct Authority as a credit broker not a lender, firm reference number 730574 and is registered with the Information Commissioner’s Office number Z3106681.

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Representative 49.7% APR.

How to get a unemployed loan in 3 simple steps.

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Choose from lenders that have accepted your application.

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If approved, the cash can be in your account in as little as 15 minutes.[†]

Table of contents

Written by Inez Miedema
Read time: ~5 mins
Published: 4th April 2016 Updated: 12th November 2020

Who gives loans to people who are unemployed?

Lenders who will provide loans to people with no job are those that specialise in lending to people with low income. Loans for unemployed usually come in the form of guarantor loans, benefit loans, budgeting loans, credit unions and low-income loans. It will all depend on your current financial situation as well as what your monthly income is.

Guarantor loans are the main option for people who are unemployed. Lenders like Amigo Loans will ask you to provide a friend or family member to sign onto the loan agreement with you. Even though another person is part of the agreement you still need to be able to make the repayments yourself. The cost of a loan can go up if you can’t find a friend or family member who is happy to be your guarantor.

Being unemployed doesn’t always mean that you have no income available. Some lenders are still willing to provide loans to people on benefits such as Universal Credit because this is classed as income.

How to get a loan when you're unemployed?

There is no way to get guaranteed loans for the unemployed. You will always need to go through a full application journey for decisioning from a lender. If you are unemployed, you will have to go through the same application process as you would if you had a regular source of income. A lot of the ordinary high street banks will refuse you credit if you are out of a job. This is what makes borrowing so hard for those who can't find work.

In order to find a loan when you're unemployed, you will need to apply with a specialist lender. These lenders will often charge higher interest rates to offset the risk of loaning funds to someone with little to no income. The risk to these lenders is that they don’t receive back the full amount people borrowed due to a lack of income. That’s why you will still have to prove you can make the monthly repayments. These payments can come from your benefits if you receive Universal Credit or a Jobseeker's Allowance.

Can I get a loan with no income?

are offered on the promise that a borrower will be able to pay back the amount borrowed within a set time frame. The better your finances are, the more likely a candidate you will be to pay back the loan on time. In turn, this increases your chances of being offered a loan with a low-interest rate.

You may still be able to receive a loan if you have no regular income. The drawback here is that you could end up paying higher interest rates because the lender is risking you not being able to pay back the loan on time.

Before applying for any sort of unemployment loan, you need to consider whether you can realistically afford the repayments each month. If you are already struggling financially, it may be wiser to not apply for this type of loan. Instead try turning to other options like borrowing from friends and family or having a close look at your budget eliminating all unnecessary expenses. There are also local charities and free money advice services, such as the Citizens Advice Bureau, who can give you impartial advice on budgeting.

How do unemployed loans work?

Unemployed loans work in the same way as any other type of borrowing. The requirements will differ depending on the lender you choose to apply with. You will need to check their criteria to see if you are eligible for these type of loans, but any of the following things can apply to you:

  • Age - Quick loans for unemployed people will only be given to those over 18 years of age. Some lenders also apply an upper age limit.
  • Residency - You will need to prove you have lived in the UK for more than three years and that you hold a bank account in the UK.
  • Credit history - Lenders may look past the fact that you are unemployed if you have a strong credit history. A poor credit score will affect your chances of being approved.
  • Minimum income level - You don't need to hold a job in order to receive certain loans, but you may still need to prove you have regular income to make the monthly repayments. Income can come from anything including benefits payments and investment payouts, so make sure to list these on your application.
  • Guarantor needed - Because you are unemployed, the lender may require you to have a guarantor sign on to the agreement. In the event that you cannot make the payment, the lender will turn to your guarantor to make it for you instead. Guarantors normally need to be employed and have a good credit score in order to be eligible.

When you apply through the Loan Search journey on this website, you will be shown which lenders are most likely to accept your application and at what cost.

Are there special loans for people out of work?

People who are out of work will find it nearly impossible to get a personal loan. However, you could still be eligible for other types of loans that apply to those on low incomes. It's important to only turn to these loans as a last resort or in an emergency. Short-term credit agreements carry high levels of interest that, if you're unemployed, can leave you in more financial difficulty than you started with.

Which loans are available to people who are out of work?

Where do you start if you require a loan but are unemployed? If you have benefits but they don't cover emergency bills that just came in?

  1. Payday loans

  2. Doorstep loans

  3. Secured loans

Loans for people without a job explained

Payday loans - A payday loan is a type of short-term borrowing that can give you a bit of extra breathing room until the next time you are paid. Interest rates can be high with a payday loan, and they only provide small amounts of money to their customers.

Doorstep loans - This is another form of short-term loan where a local agent comes to your home to assess your application. If successful, you will receive the funds as cash delivered to your doorstep. The agent will then visit your home on a weekly basis to collect the payments.

Secured loans - If you know that your unemployment status is temporary and you own property, you may consider securing a loan against this asset. A home can be used as collateral against a loan, helping to decrease the risk the lender has to take on because of you being unemployed. Because of this, it is more likely that you will be improved, although you do risk losing your home if you default on the payment.

Apply for an unemployed loan today

Now that you know you still have options when it comes to loans and being unemployed, why not check your eligibility with Choose Wisely? We check a wide panel of lenders to find the right one for you who is most likely to lend to you if you are unemployed. This check won’t affect your credit score and it is completely free to use on our website.

Get the right bad credit loan

Need more information on very poor credit loans and how to get accepted?

Unemployed loans FAQs

Can I get a loan if I'm in between jobs?

It's not impossible to get a loan if you're in between jobs, but it might be more difficult to get accepted by a lender. The loan you end up getting is likely to be more expensive and you may need to have a guarantor. You can compare loans on Choose Wisely to find out which lenders you may be eligible for an unemployed loan from.

If I'm unemployed, will I need to offer collateral to get a loan?

As a way for the lender to manage risk, you may be asked to offer a collateral to support your loan application. This collateral could be a logbook loan or a secured loan, where your car or house gives the lender reassurance on lending to you. Sometimes a lower interest rate is offered on a loan with collateral.

Do I have to have a guarantor?

It's possible to get a loan without a guarantor. However, this is dependent on personal circumstances. Having a guarantor will increase your chances of having your application accepted as it offers security to the lender, especially if you're unemployed at the time that you apply for a loan.

Written by
Inez Miedema
CMO & Take Control Author at Choose Wisely

Inez came on board in the Summer of 2019. Her main focus has been helping as many people as possible find our website through online marketing, writing content and partnership deals. She boasts 6 years of FinTech experience with other brands and has an in-depth knowledge of our customers.

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Important Information.

All of the information in this guide is correct at the time of writing.

Rates shown are quotes based on your personal circumstances, are subject to status and are available to those aged 18 and over. Rates available range from a minimum of 3.9%APR to a maximum of 1575%APR Representative and loan repayment periods range from 3 to 60 months.

[*][†] Once accepted, your loan can be transferred to you in as little as 15 minutes. The time that it takes for the loan to show in your bank account will depend on your lender and your bank.

If you need financial advice you can visit stepchange, speak to citizens advice, call the national debtline or speak to

If you've been declined, please refer to your credit report to gain an understanding of why before making further applications.
Your score can be accessed for free via any of the main credit reference agencies such as Credit Karma, Clearscore or Experian.

Warning: Late repayment can cause you serious money problems. For help, go to