Loans for the unemployed

Microloans are short-term loans that range from a few thousand to several hundred thousand pesos. They come with more flexible terms compared to regular loans, making them a popular option for obtaining financial assistance. In this article, we will explore the features of different types of loans, their advantages and associated risks, as well as look at various types of lending organizations and the factors to consider when choosing a lender.

Understanding the pros and cons, as well as the basics of the online lending system, even at a surface level, will help you make informed decisions when borrowing money with interest. Let’s start with a brief overview of the positive and negative aspects of this type of financial service.

The advantages of short-term loans include their ease of application and overall accessibility. The ability to get a loan as an unemployed person allows individuals to live better and grow faster, including in terms of income. Although it may not seem obvious, borrowed funds, while sometimes spent on trivial things, are mostly invested in health, self-development, or starting a business. The downsides include high interest rates and complicated contracts that are difficult to understand. If you read to the end, you’ll learn how to mitigate the disadvantages of microloans and get the most benefit from this financial service.

Contents:

1. How financial organizations work
2. Differences between MFIs and banks
3. Online loan application process
4. How to apply for a loan online
5. Tips to avoid fraud and unfair conditions
6. Rights and obligations of borrowers
7. Rights and obligations of lending services
8. Extensions, penalties, and collectors

How financial organizations work

Online lending services provide financial services remotely. To apply for a fast loans for unemployed online, you need to fill out a form and attach a selfie with an identification document. Usually, lending organizations ask borrowers to take a photo with an open passport. In rare cases, they also process applications with a selfie attached alongside a driver’s license or other documents equivalent to a passport.

MFIs play an important role in the country’s economic system. They provide access to financial services for individuals and sole proprietors whom banks often refuse to deal with for various reasons. For example, the banking sector is hesitant to offer unsecured or secured loans to people with existing mortgage or car loans. In contrast, microloan services do not take the borrower’s current obligations into account and provide unemployed loans for any purpose without concern for how the money will be spent.

Microloans come with fewer restrictions for several reasons. One key reason is that the ability to obtain a loan within 15 minutes at any time can encourage consumers not to delay purchases of goods or services. Think about it — when someone is unemployed and doesn’t have spare money or access to credit, they likely won’t even consider expensive products on marketplaces. But it’s a different story when they can get a loan for the equivalent of 1-2 months’ salary without leaving home.

Differences between MFIs and banks

Both financial organizations and banks lend money with interest, but they operate under different conditions. The banking sector aims to minimize risks, while MFIs cover these risks with short-term quick cash loans for unemployed in the Philippines agreements and high interest rates that are calculated daily. This diversification allows banks to remain stable for decades and support businesses and governments, while loan services help individuals and entire families.

The maximum cost of bank loans is higher. Therefore, MFIs don’t spend time and resources assessing the creditworthiness of clients who request loans for a short period and for smaller amounts, typically up to several tens of thousands of pesos. These requests are often filtered out, further fostering the development of the microloan market.

MFIs have their own strategy for assessing creditworthiness. Unlike banks, private lenders prefer to consider fewer factors when evaluating the likelihood of recovering the loan and earning interest. For example, current indebtedness is only considered within legal limits, and the presence of existing debts and overdue payments is generally ignored. This allows microloan services to expand their potential client base infinitely, ensuring stable growth for the microloan market year after year, regardless of the economic situation in the country or the world.

Advantages of online loans for the unemployed

• Application review time — from as little as 5 minutes.
• Minimal requirements for borrowers — only a passport is required.
• Support for remote loan disbursement by 99.99% of services.
• Flexible interest rates with special offers for new and returning clients.
• Loan amounts can significantly exceed the borrower’s actual monthly income.
• Chances of getting a loan are not affected by credit history, and loan approval does not impact it.
• Personal loans for unemployed in the Philippines are granted even to those who are temporarily unemployed or employed without formal documentation.

Online loan application process

Financial services are designed to make it easier and more convenient for clients to borrow money. It’s no surprise that the loan application process is as simple as possible. All that is required from the potential borrower is to fill out a form and attach a photo of themselves with a valid ID.

Borrower requirements

No income online loans for the unemployed through commercial microloan services do not require proof of a stable source of income. In the early 2000s, when the industry was still developing, applicants were asked to provide phone numbers for verifying the information in their application. Now, this is no longer relevant. No one will call or check the accuracy of the information provided, as long as the client doesn’t disappear or delay payments on their debt obligations.

Minimal requirements for those seeking a microloan with favorable interest rates:

• working age — over 21 years old but not a retiree;
• valid ID (passport);
• no legal issues or excessive debt load — MFIs do not scrutinize each application as rigorously as government agencies, but they avoid entering into risky agreements with potentially problematic clients.

How to apply for a loan online

Filling out an application for a microloan lasting a few days or weeks can be done from a computer or directly from your phone. Most forms contain only the key fields necessary to make a decision about the terms of cooperation. Here’s a general step-by-step guide on how to apply for a loan without a job and without visiting the lender’s office for an in-person document check:

1. Choose a lending service whose terms seem acceptable to you.
2. Open the application form for loan issuance — usually, a button like “Apply for a Loan” or “Get a Loan” is located on the homepage.
3. Enter the requested details in the form — typically, this includes your name, date of birth, ID information, address, monthly income, and the desired loan amount.
4. Take a photo with your ID and of the ID itself, following the instructions provided on the microloan operator’s website, and attach the files to the application.
5. Submit the application and wait for feedback from the service. Typically, if your application is approved, a manager will call or message you to confirm your intention and offer you to sign a loan agreement.
6. Sign the agreement, which is done by entering a code from a message or using a standard electronic signature.

Once the formalities are completed, the borrowed money will be sent to the account specified in the contract. It’s important to remember that the signed agreement is a legal document, so you should double-check the details, including the account number for receiving the money, before signing. If the account number is incorrect, any money sent to the wrong account won’t be reimbursed, and your loan obligations won’t be canceled.

Your application was approved. When will the money be transferred

It takes 3 to 30 minutes for a microloan operator to make a decision, and it’s rare for potential borrowers to wait longer than that. If a manager calls in response to your application and offers to sign an agreement, it means the organization is ready to send the money after all the necessary formalities are completed.

After signing the loan agreement, the funds are usually transferred to the account within minutes. However, there are exceptions. The exact time for when the loan will be credited to the card specified in the agreement will be written in the document. Reliable MFIs strive to send the money as quickly as possible, while less reputable companies tend to delay the process.

What to always pay attention to when choosing a service

Easy approval microloans are undeniably convenient, beneficial, and useful. But like any industry dealing with financial assets, this one has its share of less-than-honest companies. These aren’t necessarily scammers in the direct sense (though there are plenty of those in the market), but “gray” MFIs with contracts full of fine print and tricky clauses. Let’s explore what you can do to avoid falling victim to unscrupulous services and ending up in a debt trap.

Before submitting an application, it’s useful to take the time to research the lending company. In the Philippines, businesses are required by law to obtain a license to operate in the money-lending sector. Organizations accredited by the country’s highest financial regulatory body don’t engage in deceptive practices like excessive fine print or sneaky schemes that force unwanted services on customers.

When choosing a service for a microloan, reading reviews is essential. Our aggregator and similar platforms offer many seemingly identical options at first glance. But when you look at online reviews for MFIs, it turns out that not all financial organizations are worth becoming a client of. Fortunately, there are plenty of choices, so no borrower will be left without a suitable offer that’s free of hidden fees and forced services.

Loan terms, such as interest rates, repayment periods, and fees, are also indicators of a trustworthy lending service. Terms that are “too good to be true” almost always point to scammers. The fact is, any business needs to make a profit. An MFI won’t stay in business for long if it gives out money to everyone without fees or interest. That’s why completely zero interest rates are rare — usually, they require paying for insurance or something else. So, when you see an advertisement in your mailbox or a banner on a website promising 0% microloans with no requirements or obligations, it’s time to be cautious and carefully read the fine print.

How to mitigate risks associated with online lending

No matter how much we’d like to, no one can fully protect themselves from making mistakes when choosing a lending service. There are always risks when taking out online loans, but careful and attentive borrowers are less likely to encounter them. Becoming such a borrower isn’t difficult — just take 5-10 minutes before filling out the application to assess the situation with a “clear head.” In simple terms, to avoid risks, you need to understand what they are. You might think that the borrower takes the money and doesn’t pay upfront, so what risks could they possibly face? Unfortunately, there are several.

Possible risks when taking online loans:

• The loan is not approved, but your personal data is saved and used.
• The loan is approved, but hidden services are added, which you’ll also have to pay for.
• The loan is approved, but the full amount isn’t paid, with small print in the contract explaining deductions and fees.

As you can see, avoiding risks is possible by carefully reviewing information about the lender before sending in an application with a selfie and your ID.

Tips to avoid fraud and unfair conditions

Don’t hesitate to ask questions. Trustworthy lending companies ensure that their managers inform potential clients about their products. They don’t refuse consultations. On the other hand, “gray companies” and scammers avoid communication. Transparency is the first sign of a reliable service.

Read the contract carefully and don’t rush to send codes from messages until you fully understand their origin and the agreement’s terms. Scammers often trick victims into sharing authorization codes for bank apps by disguising it as a loan agreement. To avoid being deceived, apply for a loan with a calm and clear mind. Any codes from services unrelated to the MFI are not required to sign the loan agreement — only criminals ask for them.

No one can force you to pay for services or products you don’t need. If, during the loan application process, you’re suddenly asked to pay for consultation or other services, you have the right to refuse to sign the contract. Even if a manager has spent half an hour explaining the benefits and conditions, it’s no reason to agree to potentially unfavorable terms. The market is full of offers, and this is certainly not the only microloan platform available to the unemployed.

Rights and obligations of borrowers

The borrower is required to repay the loan in full and pay the interest for using the microloan. Besides the obvious obligation to repay the debt, MFI clients also have the responsibility to remain in contact with the lender. As for rights, there are quite a few. All of the borrower’s rights are included in the loan agreement. Typically, the text includes the following rights: fixed terms, confidentiality of the transaction, refinancing or extension in case of unforeseen circumstances.

Rights and obligations of lending services

The lending company is obligated to send the borrower the agreed-upon loan amount within the timeframe specified in the contract. It also cannot unilaterally change the terms, account details, or any other fixed information without notifying the other party. As for rights, no one can stop a legally operating MFI from collecting money from a debtor, selling their data to third parties for a fee in case of late payment, or taking legal action to protect their interests within the framework of the law.

Extensions, penalties, and collectors

Life is unpredictable, and it’s not always possible to foresee everything, especially financial difficulties. If you’re unable to repay the loan, it’s essential to contact the MFI representative as soon as possible to work together to find a solution. It’s important to understand that debts won’t simply be forgiven, as the business would suffer losses. However, most loan operators are willing to work with clients facing difficulties by offering extensions or refinancing services for the debt.

What to do if you can’t repay the loan on time

To avoid penalties and dealing with collectors, who often buy problem microloan contracts, it’s crucial to contact the lender in time and request refinancing or an extension.

The essence of loan refinancing is obtaining a new loan to cover the existing one. This shifts the repayment deadlines, though not for free. The service provides the borrower with a loan equal to the outstanding debt plus interest. A new loan also comes with interest, which increases the debt, but gives the borrower a chance to solve the problem — earn the necessary amount before the refinancing repayment date and clear the debt.

Loan extension involves a paid delay in repayment. The key difference is that no new contract is required. The service asks the client to repay part of the debt, and the due date for the remaining amount is postponed, with penalties added for each day. The benefit for the lender is clear. For the borrower, this offers additional time to find the money and clear the debt without damaging their credit history or reputation.

What happens if you don’t repay the loan and ignore the lender’s calls

You can’t hide from the lender — the law won’t allow it. Current legislation protects not only the borrower but also the lender. Therefore, if a borrower fails to meet the terms of the agreement, the lender has the right to defend their interests in court. Any attempts to avoid answering calls from collectors may lead to facing court, and this can result in real legal consequences. It’s always cheaper to pay off the debt than to try and cheat the system.

Borrowers who don’t hide from the lender are protected from harassment by collectors: no late-night calls, threats, or disclosure of personal data. It’s not profitable for any business to waste time making life difficult for someone. Hiding from debts is never a solution and only creates more problems for your peace of mind.

A microloan for the unemployed is a service that offers the opportunity to afford more or cover budget gaps with ease. There’s nothing wrong or dangerous about it, as long as the loan is taken seriously and you don’t borrow more than you can repay without delays. Our site’s catalog offers a selection of reputable MFIs, so choose the right one and apply for a loan today.