Social Security Loans Assistance & Options

SSI loans and  benefitsGetting financial assistance when on a low fixed income like social security can be difficult. Many lenders approval criteria filters out low income earners as their ability to service loans is lower than those on a higher income.

If you are on social security and need a loan or additional financial help you may qualify for Supplemental Security Income (SSI) which is an additional income option for those who receive social security and worked at a low-wage job for most of their lives. Not everyone is eligible for SSI; we will cover eligibility, additional program information, and options regarding the finances of the program in further detail below.

If already collecting SSI jump towards the bottom of the page for loan options for people on social security benefits - including the interest free loan loophole

More about SSI

SSI is not designed to take the place of social security; it is merely additional income to supplement the small amount received in social security by those who earned little while employed. SSI is intended to be used for every day necessities such as food, clothing, and shelter. SSI can be used to support the elderly, blind, and disabled individuals.

SSI Eligibility

Eligibility requirements are simple and detailed below:

  • Individuals must be at least 65 years of age, disabled, or blind.
  • Individuals must have limited resources and a limited income.
  • Individuals must be either a U.S. citizen or an approved alien
  • Individuals must not be currently kept in prison, jail, or a hospital at the government’s expense.

Those who are curious whether they are eligible or not, can spend 5 to 10 minutes answering a simple questionnaire with more specific information.


Applying for SSI

Those who have gone through the SSI eligibility screening process who wish to apply for SSI can call 1-800-772-1213 to make an appointment to apply for SSI benefits with an office representative either over the phone or in your local Social Security Office. It is suggested that those who believe they are eligible for the assistance apply as soon as possible to avoid delays or loss of benefits.

Applicants will have to work with support staff and personnel to access required documents and complete an application. Documents include the applicant’s social security card, a public birth record, your proof of citizenship or alien status record, proof of income, proof of resources, proof of living arrangements, medical sources, and work history. This information will be used to determine eligibility and supplemental income amount.

The representatives at the office are trained and obligated to help you within the realms of your best interest. If you apply and don’t get a satisfactory response or outcome, you have the right to appeal.

Just because you or your loved one worked a low income job while they were employed doesn’t mean they should be subjected to poverty in their old age. SSI is designed to help those with limited financial resources live with the basic comforts and necessities of life including clothing, food, and shelter. If you or your loved one are blind, disabled, or over the age of 65 and you have limited income and resources, you may be eligible to receive additional assistance. If you believe you’re eligible, make an appointment over the phone or with your local Social Security Office right away to begin the application process and start collecting the money that you’re due. Don’t forget to have the originals of all required documents to speed up the process and start collecting your money now.

Things to Consider Before Applying for a Loan When on Social Security

There are numerous circumstances that will influence your ability to qualify for a loan if social security is your main or only source of income – some of these conditions include:

- Age
- Credit history
- Length of time on social security
- Additional income streams
- Assets
- Debt levels
- Savings
- Marital status, dependencies

The above are some of the main things lenders look at and each lender will assigning their own weighting system on what is most important to them when evaluating risk and if they will consider lending to you.

Taking the above into consideration, if you have a negative position across multiple criteria it is best to talk to the lenders in detail before applying. If you submit a high number of loan applications in a short period, this can have a negative impact on your credit score – so be wary of submitting multiple applications and speak to the loan officers first.

Possible Social Security Loan Options

Many social security recipients believe that expensive Payday loans are their only option of getting a small or short-term loan. While they may be a quick and easy way to get cash, they are very expensive and can put you in a bad financial situation quickly. A simple search online will provide thousands of horror stories on the negatives of payday loans.

Below are a range of different financial options and loans for people on social security. If you are overwhelmed with options or are unsure on which option might be suitable for you – speak to a free unbiased financial professional who can access your situation and point you in the right direction.

Check with your bank: Many banks have specialized loan products that they don’t actively advertise. These are newly created loans which they provide that are cheaper alternatives to payday loans. These products go under names such as check/saving account advances, stretch loans, salary advances (if you work). Ask for these products at your bank or credit union - See a full list of low income loans here.

Peer to Peer Lending: This is a newer form of funding that is much cheaper than payday loans and they often provide borrowers with higher limits than other lenders. There are numerous p2p lenders popping up so make sure to check reviews of providers you may want to borrow from.

Government Benefits: If you are having cash flow problems, looking into government benefits beyond Social Security and Supplemental Security Income can go a long way. Learn how you can get additional help with paying bills here.

Family or Friends: Borrowing from people you know may not be everyone’s cup of tea but this can be one of the quickest and cheapest ways to get financial help.

Secure Loans: Depending on your situation and why you need money, putting up collateral to obtain cash may be another option. If you do consider an option like this, be 100% sure that you can make your repayments as you will lose the asset if you default.

Interest Free Social Security Loans

This is more like a loophole that is suited to higher income families and individuals. The loan strategy works like this. Anyone who is collecting Social Security has the ability to change their mind on when they collect payments and start over – as long as they pay back the initial money received. So, if they invested this money or earned interest on this money, they get to keep any income earned and only have to pay back the initial payments received.

The borrower essentially benefits in two ways:
- They keep any interest earned on the original payment amounts (an interest free loan from Social Security)
- Future Social Security payments may be higher as they “postponed” their start date

As an example: A person starts receiving benefits at the age of 62 and then decides to start over at the age of 70. If in that 8-year period, the person received $1300 a month that would equate to $124,800 over that period. If they earned 8% interest each year on that amount, they would receive around $50,389 in interest payments.

So the borrower would get $50,389 in interest payments for that eight year period and still get access to the original $124,800 as part of their social security payments when they start over – This is how those who can afford to pay back the principal can receive an interest free loan from Social Security.

Options for Social Security loans

Additional Social Security Benefits Help
Social Security is a complex benefits program that covers numerous financial assistance situations including retirement, disability, survival benefits, supplements and more. To get more detail and review some of the frequently asked questions in regards to benefits and financial assistance review this guide to social security help or scan this FAQs guide on SSI and Social Security.