When you have a bad credit rating the process you have to go through to get a loan is a little different. Lenders who are willing to give out a bad credit loan will look at things other than your credit history. They also consider your income and whether or not you are employed. Whether you have a job or not can be a major factor.
These subprime lenders are on the lookout for stability, and that includes having a stable job. Here’s a look at some of the different requirements for bad credit loans, with an emphasis on employment requirements.
Employment Requirements for Bad Credit Loans
There are no real rules on the employment requirements because every lender will have their own requirements. For the most part however a lender will be looking for people who have been employed for at least five months with their current job, and overall three years-worth of employment history.
To put it simply the longer you’ve been employed the more stability you show to the lender. Being employed also allows a lender to verify your income. Knowing your employment situation is especially beneficial for hourly workers because lenders are able to see the consistency in overtime hours.
There are several different factors that lenders will look at. They approach each case individually. Don’t allow yourself to be discouraged and avoid applying because you aren’t a perfect match. These bad credit loan lenders understand how complex employment can be and are willing to listen to your situation.
A subprime lender also understands that there are times when people find better jobs. If you change your job but stay in the same field to earn more money and have better opportunities then the lender will be understanding. If you recently changed jobs for the money then you could still be approved even if you only recently started the job.
Even if you were to switch fields completely the lender would still be open to hearing why you did it. As long as you can avoid having long gaps between employment (90 days is a general rule of thumb) then they typically won’t have an issue with you changing jobs.
There could be an issue if you aren’t able to show that you have a long history of employment. However a lender will still consider other signs of stability such as residence history. If you’ve been living at the same address or just the same area for a long time then this could be good for you. Owning your own home and not renting is a real plus in the world of bad credit loans.
If you feel that how long you’ve been employed could be an issue then you do have some options. Two of the easiest ways to move things in your favor is to have a co-signor and offer a lot of money as a down payment. These methods will greatly boost your chances of approval if you have poor employment history because they greatly reduce the risk the financer is taking.
These employment rules and regulations are also aimed at people who work full time. There are separate rules and regulations for self-employed people and part-time workers, particularly those who hold several jobs. So be sure to talk to the lender about your situation and find out if you’re a good fit for their bad credit loans.