Whether you are a permanent employee, hourly wage, freelancer or something else, you will have some paychecks lying around. Usually, a bank will require you to present these as evidence of your income. With an online bank, however, you get the opportunity to take out loans without paychecks. We give you an overview of the possibilities and limitations of borrowing money without paychecks.
Online loans without paychecks
There may be several reasons why you will not submit your paychecks in an application. You may be out of work, on unemployment benefits or not wanting to share your income. Whatever your reason, there is thus the opportunity to take out a loan online without paychecks.
Here is a selection of the providers you can consider searching for. All applications are free and non-binding.
By failing to show the paycheck, you will often be left with the smallest amounts of money. As seen in the overview.
However, you need to be aware that you are limiting yourself by going this route. In other words, you will exclude the possibility of applying for medium and large loan amounts. Here, the providers will require you to be able to document an income so that they can make a credit assessment and make sure that you will be able to repay the money. So while it is possible to apply for a loan without paychecks, your options will be quite limited.
At the same time, you should be aware that even if the provider has no fixed income requirements, they may still want to see your latest paychecks and annual statement. Of course, that will be part of their rating of their credit rating and influence their decision. Even without pay, you can apply to these, although it will be harder to get approved.
There is generally a close relationship between your desired loan amount and the provider’s requirements for your personal finances. Loans without paychecks will therefore primarily be possible when applying for lesser amounts of money.
Possibility of small loan amounts
That said, there are several providers that do not require any evidence of income. This is especially true for small amounts, which is why you can easily apply for most mortgage loans. There is also an opportunity to have a consumer loan granted but in this case there will typically be small amounts of USD 10,000 or less.
Paychecks will give you a better starting point
It can generally sound attractive and easy that you can apply completely without having to find paychecks and annual statements. However, it is not something that makes you stronger as a customer, or gives you a better starting point. On the contrary. When you need to search and find the cheapest loans in the online market, it typically requires you to submit both paycheck and annual statement.
So if you go for a cheap solution, you can almost be sure to submit it sooner or later, no matter what. So you should generally spend 10 minutes finding both parts via eg. E-box or Tax, especially if you have the opportunity and want to apply for larger amounts of money. Then you also have it ready when you have to search for more places.
Can unemployment benefit count as ‘paychecks’?
There are a lot of people on unemployment benefits and it may be obvious to think that the unemployment benefit can function as a ‘paycheck’. After all, it’s an income just like everything else and it can actually be higher than if you were in a part-time job.
Of course, we think you can view the unemployment benefit as an income and by applying to those providers without income requirements, you should continue to have good chances of being approved. After all, you can indicate your unemployment benefit in the application form and if they subsequently want to see material, you can explain where the money comes from. It should be no problem.
How the individual provider will then look at you being unemployed, but on unemployment benefit, on the other hand, will vary. There is no doubt that the credit rating is worse when the money comes from unemployment benefit rather than regular work, but opportunities should still be reasonable. Simply expect interest rates to be slightly higher.
What about the credit rating?
You do not have to go through a credit rating even if you apply for a loan without paychecks. Of course, the provider will not be able to go in and assess your finances in the same way to determine an appropriate interest rate for you. But they will at least go in and check if you are registered as a poor payer.
The vast majority of providers will not lend money to people who are poor payers. And it is also a bad idea for you to seek more money if you are already registered in RKI. Therefore, even if you apply for a loan without paychecks, they will carry out a credit rating of you as a customer.
Income is included as a fixed part of most credit ratings, so by not being able to document your income, the provider will be at higher risk. You must therefore expect the interest rate offered to be slightly higher than usual. For that reason, you should present the paycheck when seeking loans online as far as possible.