Because of the lack of jobs and economic downtime, the need for disposable income keeps increasing. Understandably, we encounter unending needs and to this effect, we must use money to solve these needs. Loans for non-salary earners offer cash flow to the unemployed and self-employed people in South Africa. What loans for non-salary earners are, how to apply for those loans, etc are all-inclusive in this article.
What are loans for non-salary earners?
In order to know what loans for salary earners are, understand who a non-salary earner is. A non salary earner is someone who earns a fixed regular payment made by an employer. The employer usually makes this payment monthly, for professional or office work, unlike manual work.
From the explanation of what non salary earner means. You can see that the unemployed and self-employed people fall under the category for non salary earners.
These non salary earner loans can be; student loans, payday loans, but usually personal loans. The aim is to provide money for people who do not have employers who pay their salaries.
What is an unemployed loan?
The unemployed loan is the type of loan that people with an unstable job or source of income can get. The credit terms, interest rates and some other features usually differ from what employed people get. They also consider the unemployed loan as a loan for non-salary earners. However, you can get a non-salary earner loan from financial institutions in South Africa.
How to get an unemployed loan?
Having understood the meaning of loans for non-salary earners and the people who fall under its category. How you can get the loan should ring in your mind at the moment. You can get the unemployed loan under special terms and conditions.
Most times financial institutions will offer you a loan as a non-salary earner if you provide a collateral.
How can I apply for a personal loan for non-salary earners?
The method of application for loans differs across financial institutions. Besides that, applications for the loans for non-salary earners (both unemployed and self-employed) differ across financial institutions.
The following are the ways you can apply for the non-salary earners loans:
- Visit the financial institution that offers loans for non-salary earners and request the loan. Submit the documents they require getting your loan.
- You can make your application online. By visiting their website with your smartphone, tablet or personal computer. Provide your personal information and follow the prompts to get the loan.
- You can reach the customer executive of the financial institution over the phone. Make your request for the loan known to them. They’ll guide you on how you will secure the loan.
What are the loans for non-salary earners (unemployed)?
There are types of loans for the earners (unemployed). But before you get the loan, provide a collateral. This is because you don’t earn salaries and because of that the financial institution doesn’t have your bank statement of account. This makes them see lending you money as a tremendous risk.
The following are the loans for non-salary earners (unemployed):
- Property loan
You can get a loan against your property if you need money. This is a means to secure your loan because you don’t earn salaries. If you can’t provide security (collateral) for the loan, your lender might not give you a loan. It’s a risk to give a non-salary earner, therefore collaterals will help secure you the loan. Because of the tremendous loan size that usually comes with the property loan. You can consider starting up a business and earn a regular income.
- Secured personal loan
Secure personal loan helps you to make big purchases or consolidate high interest debts. You can only get this loan by providing security (collateral) for it. Because of the collateral, you’ll have a lower interest rate to the loan
- Loan under government scheme
Some government loan schemes offer loans to youths. These kinds of schemes provide self-employment opportunities for the youths.
What can I look out for in getting a personal loan from different banks as a self-employed?
In getting a personal loan, there are details you need to consider. Even as a self-employed individual, you must make the right decision.
The following are the things to look out for in getting a personal loan as a self-employed:
- Always compare the interest rate the different banks offer and choose the one you prefer
- Keep in mind the Equated Monthly Installment (EMI)of different banks. Compare and contrast the monthly EMI of different banks for the same loan amount
- Consider how fast they disburse payments
- Know the bank that offers the lowest processing fee.
- There are some banks that include prepayment charges
- Make your choice regarding the loan tenure they offer. Choose the one that suits you best
Will my credit score play a role in getting a loan for non salary earners?
A good credit score ensures you have a better chance of getting a loan for non salary earners. A health credit score increases your chances of getting any form of credit. It encourages the lender by showing your pleasant habit of repaying debts, even if you’re not a salary earner.
Conclusion
The loans for non salary earners is a sure way to include non salary earners financially. They can now start-up businesses and make investments. Besides that, they now have the same opportunity of cash flow just like their salary earners counterparts. This gives them a sense of belonging in the South African society. However, they must ensure they repay their loans to have the same opportunity in the future.