Category: Borrowing Money

Should I Borrow Money if I don’t have a Permanent Job?

Borrowing money is something which is very easy to do and many people do it. However, before you do borrow money via a quick loan it is important to think about whether it is something which is right for you. Some people in some circumstances take more risk when they borrow than others. So, for example, if you do not have a permanent job, should you be considering borrowing money?

If you do not have permanent employment, then you are unlikely to have access to a great selection of loans. Lenders will take a look at your credit record and see that you do not have a regular income and they will see this as a risk. This will mean that they could either decide not to lend you any money at all or they will lend to you at a high interest rate, as they do with all high risk borrowers.

The reason that they will not lend, or lend at a high rate is because there is a risk that you will not have the funds to repay the loan. Therefore they charge more and hope to get more money out of you towards the cost of the loan before you find that you cannot manage the repayments and stop paying them. This is a risk that you do not want to take either. If you cannot make the repayments then you will get an even worse credit record. This will not only make it hard for you to borrow more money but it could also mean that you will struggle to even find a house to rent and you may even struggle to get a job. A credit record is very important and so you want to make sure that you do not borrow money and then find that you get into trouble with repayments as it could have a big impact on your future which could be very far reaching.

Although this all sounds very negative, you may still find that there are forms of borrowing available to you and these could be something to consider. You may already have a credit card, for example and this could be worth using in some circumstances. Whenever you are taking a decision as to whether to borrow money, you should always consider whether you are confident that you will be able to repay the loan. This could mean that you have to make regular monthly payments or it could mean being self-disciplined enough to pay off a credit card bill rather than just paying back the minimum amount and paying lots of interest on the loan. It is worth thinking about whether you will be able to manage this; both in your current circumstances and in the future. It might be that you are confident that you will soon be able to get a permanent job that will pay you more than enough to cover the repayments or that you fear you will lose the job you have and be out of work for a period of time.

If you have other earners in your household then you might be able to split the cost of the bills and therefore have more money available to make repayments on a loan. If you get into difficulties you might be able to rely on them to help you out; therefore making the loan a lower risk for you. Alternatively you may be really well paid, perhaps working as a contractor and therefore be very confident that you will have the money to be able to afford the repayments.

So really the answer to the question as to whether you should borrow money if you do not have a permanent job is very much a personal thing. It will depend on what you see might happen in the future as well as how your finances are now. If you have other earners in the household this could help you as you will be able to get help from them to cover other bills, if you are well paid, then you will be more confident that you can make repayments than if you are not well paid. So you need to assess your own personal situation so that you can find the right solution for you.