Refinancing a personal loan involves taking out a new loan to pay off the existing personal loan. If are thinking about refinancing a personal loan but are currently unemployed, then you may be wondering if refinancing is even an option.
Refinancing a personal loan even if you are unemployed, although may not be easy, can be done. Let MaxCash explain how the process my go down.
Factors to Think About When Refinancing Your Personal Loan When Unemployed
If you are unemployed and thinking about refinancing your personal loan, there are a few things to keep in mind. When refinancing a personal loan, or any type of loan, it is important to improve the terms of the previous loan.
When refinancing a loan, borrowers typically want:
- To lower the monthly payment
- To extend or shorten the time to pay off the loan
- To find a better interest rate
- To find a more flexible repayment plan
- To find a more flexible lender
- To switch to another type of loan
Generally, the main goal with refinancing a loan is to find a new one that better fits your lending needs and finances. Additionally, it is important to think about whether you can afford the new loan comfortably.
The Importance of Income When Refinancing a Personal Loan
Even though being unemployed may not deter you from refinancing your personal loan, you will need to prove you have some sort of income.
Here are some alternative forms of income that may be accepted by lenders:
- Permanent Disability
- Social Security Benefits
- Legal Settlements
- Prizes, Awards, Or Other Settlements
- Severance Pay
- Workmen’s Compensation
- Income types that many lenders will not accept as valid sources of income:
- Temporary Disability
How to Show Proof of Income When Unemployed
There are a few ways to prove non-traditional income to a lender. These documents could be used:
- Through tax information (W2 and/or your 1099)
- Through letters of income
Where to Look to Refinance a Personal Loan When Unemployed?
When looking to refinance a personal loan when unemployed, there are generally two ways to go about it:
Getting a Loan through a Direct Lender
A direct lender is one who gives out a loan themselves, if you do decide to work with a direct lender for refinancing, then you will have to find the lender yourself.
There are all kinds of direct lenders out there. Some have brick and mortar locations, some operate solely online, and other lenders provide both options.
Additionally, some direct lenders may only give out a certain type of loan for refinancing, while others may give out several different kinds of loans.
Getting a Loan through a Financial Connection Service
A financial connection service doesn’t give out loans themselves but connects those who qualify with reputable lenders. They usually work with all kinds of loans for refinancing, and usually operate over the phone or online.
What is the Better Option If I Am Unemployed?
If you are unemployed, the better option may be to refinance a personal loan through a financial connection service. This is simply because they have connections to numerous lenders who may be more flexible when it comes to a person’s employment status. Simply put, more numbers may mean more chances for eligibility.
Can MaxCash Help Refinance My Personal Loan If I am Unemployed?
MaxCash is a title loan connection service, who works with all kinds of lenders and all kinds of loans. Because of this variety, we may be able to work with several financial situations, including unemployment.
When it comes to refinancing a personal loan, we can help a person navigate through the process once they qualify. Here are some advantages that we offer:
- Exceptional customer service
- Years of experience in the lending industry
- We do the search work for those who qualify
- We are open 7 days a week and offer extended hours
- We offer a variety of loans and a variety of lenders
Many people choose to refinance their loans because they want to find a loan that fits their finances better than their existing one. If you are unemployed and are thinking about refinancing your personal loan, let MaxCash help you—we offer free financial guidance!