Car Loans For The Unemployed – Are They Available?

Are car loans for the unemployed actually available? The surprising answer to this question is that yes there are companies out there that will give you a loan in order to get a new car even if you are unemployed, but clearly there will be some rules and regulations that you need to be aware of prior to going ahead and applying for this type of funding. That being said, the information that follows may prove to be quite useful to a number of people.

Car LoansYou will also find that they are available in both a secured format as well as unsecured and what this means is that some companies will give you the money if it is tied into some kind of asset such as a house, whilst others will not require any assets as they see the car as being the way to recover their money should you miss your payments. Yet again this is another reason why you need to shop around first in order to find the type of loan that is going to suit your circumstances, but as you look around you will also notice a difference in rates, so it is worth looking at those in more detail as well. You will probably find that the loan rates for a secured loan will be lower than those for an unsecured loan. For example, home equity loan rates will likely be lower than those for an unsecured personal loan because banks can be guaranteed some collateral should you default.

You will also find that they are available in both a secured format as well as unsecured and what this means is that some companies will give you the money if it is tied into some kind of asset such as a house, whilst others will not require any assets as they see the car as being the way to recover their money should you miss your payments. Yet again this is another reason why you need to shop around first in order to find the type of loan that is going to suit your circumstances, but as you look around you will also notice a difference in rates, so it is worth looking at those in more detail as well.

Due to the higher risk of you missing payments you will have to pay a higher interest rate than you would with a normal loan from a normal source. These interest rates can actually run into three figures with some companies, whilst others will charge you around 50% and even this can cost you a lot of money during the duration of the loan. What you need to look out for is whether or not they charge you any fees for paying it off early because if you find your way back into employment you are advised to pay it off as quickly as possible as that will save you a small fortune compared to paying a minimum amount on a monthly basis.

So car loans for the unemployed are available from a number of companies and applying for this type of funding is easier than you may have initially thought. Yes you will pay more for the loan than people that are in employment and yes you will stand to lose your car if you fail to keep up with the repayments, but as long as you are careful with your money, then you can look forward to driving around in a new car even when you are out of a job.