Loans for Unemployed People

Cara Bradley

Written by

Cara Bradley

4 min read

Updated: 05/04/2024

Unfortunately, we might find ourselves out of work at some point in our lives for a number of reasons, such as redundancy or a long-term illness.
Being unemployed or without a regular income can feel frightening and you might start to think about ways to help tide you over during this time.

Our guide to applying for a loan when you’re not working explains all you need to know about your chances of approval, as well as some alternative options you may wish to consider.

Can I get a loan if I’m currently unemployed?

If you’re unemployed, getting approved for a loan may be difficult, although it’s not impossible. Lenders are more likely to see you as a lending risk if you’re not in receipt of a regular income, even if you have good credit history.

Taking out a loan is a serious financial commitment and you should think very carefully and weigh up all your options before deciding whether to apply.

Can I get a loan if I’m in receipt of benefits?

Some lenders might consider certain benefits as a form of regular income, although it’s important to remember that not all will.

Benefits that might count as a source of income include:

  • Universal Credit.
  • Personal Independence Payment (PIP).
  • Incapacity Benefit.
  • Employment and Support Allowance.
  • Child Benefit.
  • Child Tax Credit.
  • Fostering Allowance.

The following benefits are unlikely to be considered as a source of income:

  • Jobseeker’s Allowance.
  • Income Support.
  • Pension Credit.
  • Housing Benefit.

Can I get a loan if I’m unemployed and have bad credit?

It’s unlikely that you’ll find a lender prepared to accept your application if you’re unemployed and have poor credit history.

While some lenders are willing to consider applications from those with poor credit, it’s worth bearing in mind that if you are approved for a loan with bad credit, it’s more likely you’ll be offered a higher interest rate, and you may not be able to borrow as much money as you need.

Can I search for a loan with Viva Money?

Viva Money is a credit broker, not a lender. We work with a trusted panel of lenders who offer personal, unsecured loans from £100 to £10,000. Depending on how much money you apply to borrow, you can choose to repay your loan between 3 and 60 months.

You can search for a loan with Viva Money if you’re unemployed, but please be aware that we may not be able to find you a suitable match.

If we cannot match you with a loan, we may show you other products and services that you may be interested in; you are, of course, not obliged to use these. Please be aware that some of these services charge a monthly fee.

To search for a loan with Viva Money, you must:

  • Be over the age of 18;
  • Be a UK resident with a UK registered address;
  • Have a UK bank account with a valid debit card; and
  • Have a regular source of income paid directly into your bank account. As we discussed in the section above, this could include some types of benefit.


It can feel really frustrating when your loan application is unsuccessful, especially when you’re in need of funds to cover the cost of a financial emergency.
Please remember that lenders will not accept an application if they believe there’s a chance you might struggle to make your repayments.
Falling behind on or failing to make your repayments puts you at serious risk of additional fees and charges, a decline to your credit score, and increased financial pressure.

While we understand how daunting it can be when you need money and are struggling to get approved for credit, try to step back and look at the bigger picture. Getting yourself into further financial stress is not worth it.

Some loan alternatives you may wish to consider if you’re unemployed

Save up. We understand this isn’t always an option; however, if your need for cash isn’t urgent, it may be worth thinking about saving up instead. While this will take longer, you’ll avoid interest fees and any potential impact to your credit score.

Speak to loved ones. Could friends or family help you out? When borrowing from loved ones, make sure clear rules are put in place from the offset so everyone knows where they stand. Be realistic about repayment timeframes, and if you run into difficulties paying the money back, be honest and tell them.

Get help. You can check that you’re getting all the financial help you’re entitled to by using the free Benefits Calculator at Turn2Us.

I’ve taken out a loan but can no longer afford the repayments. What can I do?

If you’re struggling to repay your loan, you should contact your lender as soon as you can.

Your lender is not there to judge you or your situation and will appreciate the fact that you have reached out. They will want to work with you to put a plan in place moving forwards.

Where can I find money advice?

Free, impartial money and debt management guidance can be accessed online through various sites, including MoneyHelper, Citizens Advice, and National Debtline.

Viva Money is proud to have teamed up with debt charity StepChange to provide a Money Health Check quiz. The quiz can be taken online for free and will not affect your credit score in any way. The answers you provide will generate advice to help you understand what you can do next to take back control of your finances.