Unemployed car loan
Obtaining a car loan when you have no job, are unemployed, compensated by the Car Lender, or even if you receive social assistance such as the RSA is often impossible.
Indeed, all the credit organizations ask for solvency guarantees before granting a loan, and not having a salary places the borrower in a situation of probable insolvency, even if the replacement income which he receives allows him, in terms of repayment capacity, to borrow.
Banks follow the same reasoning, even if some are more flexible and build on the trust established with their unemployed customers. Indeed, if the financial path of their customers is spotless, they can accept to take the risk of financing the purchase of a vehicle, but cases are rare if one does not offer a guarantee.
The bank loan for the unemployed: a question of confidence
A bank can give a loan to an unemployed client if their career is spotless and they have never had any problems.
First of all, when you are unemployed and need to buy a car, you must, therefore, ask your own bank if you have had your accounts there long enough to have established a relationship of trust.
The bank will obviously not grant a substantial loan for a new car, but a sufficient sum to acquire a used vehicle, which is already correct.
Unemployed car financing: using the guarantor
If having a job, and therefore a fixed salary, is a guarantee for banks and credit organizations that offer car loans, the fact that a third party is responsible can also do the trick. The principle is very simple: a person close to you, parent or friend, must vouch for you when you sign your car loan.
The guarantor, also known as a joint surety, then agrees contractually, and without the possibility of retracting later, to pay all the sums that you owe to the bank or the organization and that you couldn’t pay yourself. This means that, if you do not pay your monthly payments, the bank will use the account of your guarantor, which offers him the guarantee of being paid at all costs.
When you want a car loan, that you have the capacity to borrow and repay, but that unemployment blocks, the joint guarantee is therefore considered, on the initiative of the bank which will ask you if someone can guarantee your loan.
Social micro-loan to finance a car
Social micro-loans are widely used to finance the purchase of a car when you cannot present payslips to a bank or a credit institution. Social micro-loans do not go through the traditional banking circuit, associations are responsible for them.
To benefit from this type of credit, you must contact a social worker, who will take charge of the file. It will assess income and expenses, then establish micro-loan requests from local stakeholders.
This type of loan is aimed, among other things, at the unemployed who are compensated by the Car Lender, as well as the unemployed who are compensated by minimum income such as the RSA, and makes it possible to finance small sums, therefore the purchase of a car opportunity, worth around 3000 euros.
Obviously, the purchase of the vehicle must be justified, so for example that it is necessary for the unemployed to return to working life.
To finance the purchase of a car when one is unemployed, one can also turn to the pawnbroker. Only managed by Municipal Credits, present in most major cities, the pawnbroker loan is a loan in exchange for one or more valuables.
It can be a work of art, jewelry, but also more unusual goods such as a bottle of grand cru wine with a significant market value. The money received by pledging the object is immediately available and makes it possible to finance the purchase of a car.
Car loan from individual to individual
The loan between individuals, still unknown a decade ago, tends to spread because it offers many advantages. This type of loan is first of all much more flexible in terms of approval criteria, and the unemployed can more often than not claim it, if they are compensated for their situation, in particular by the Car Lender.
The long-term unemployed, who receive aid such as the specific solidarity allowance or the RSA, can also claim it, even if it is a little more difficult. Indeed, if the situation is not a criterion for rejection, the amount of monthly income is one: an unemployed person with correct compensation is more likely to be granted a loan between individuals than a person receiving the RSA, because his monthly income is higher, so his repayment capacity is better.
In addition, the interest rates on loans between individuals are generally much more attractive than those charged by banks, which is not negligible when one wishes to finance the purchase of a car and that one has reduced income due to unemployment.
Finance the purchase of a car across the border
One solution when you are unemployed and want to finance the purchase of a car is to go to a foreign bank. However, this is generally only possible for cross-border workers or people working in Belgium or with a bank account there.
For others, very often, the same guarantees as in France will be requested, in this case, payslips for the last three months. It is, therefore, necessary to find out about the banks which grant car loans, in Belgium or Luxembourg for example, to French people who are unemployed and to study the conditions of loan contracts. But it remains a correct solution to buy a car when you are unemployed.