Social security disability loans

can i get a loan on my disability check

Every month, about 14 million people get a disability check from the Social Security Administration.1 If you receive disability payments as income and need emergency cash, you may ask, “Can I get online loans using my disability check?” 

Keep reading to learn how to use disability payments to borrow money from a lender!

Types of Disability Payments 

Many financial institutions accept alternative forms of income, such as disability payments. Supplemental Security Income (SSI) and Social Security Disability Insurance (SSDI) are the two types of disability payments issued by the Social Security Administration. While both programs offer benefits to disabled individuals, there are distinct differences and qualification requirements.  

CriteriaSupplemental Security Income (SSI)Social Security Disability Insurance (SSDI)
Eligibility Age65 or older, blind, or disabledNo age restriction, must be disabled
Income RequirementsLimited income and assetsNo income limit, based on work history
Work History Required?NoYes
Tax Payment Required?NoYes, must have paid Social Security taxes
Type of DisabilityMust last a full calendar year or result in deathPhysical or mental impairments that interfere with work
Payment SourceSocial Security AdministrationSocial Security Administration
Effect on Loan EligibilityCan be used as income for disability loansCan be used as income for disability loans
Common Use CasesElderly, blind, or disabled with limited incomeDisabled with a work history and Social Security tax payments

Supplemental Security Income

Supplemental Security Income (SSI) is a federal program that provides monthly payments to more than 7 million people who have limited income and few resources.2 SSI recipients must also have limited income and assets to qualify for financial assistance. Disabilities have to last a full calendar year or result in death. It’s possible for disabled persons to receive SSI without a previous work history and without paying Social Security taxes.        

Social Security Disability Insurance

Social Security Disability Insurance (SSDI) pays individuals who have physical or mental impairments that interfere with their ability to work their regular occupation. Unlike SSI, recipients of SSDI must have a previous work history and pay Social Security taxes to be eligible for benefits. 

Can I Get a Loan Using My Disability Benefits?

Do you need money to pay upcoming bills and other high-cost expenses? Know that the Equal Credit Opportunity Act prevents financial institutions from discriminating against disabled individuals. You can potentially use your government assistance income to get quick cash loans, such as cash advance loans and payday loans. However, you are still subject to the lender’s eligibility criteria. 

When you apply to borrow money, lenders will assess many factors—most importantly, your credit history and income. You may find getting a great loan offer challenging if your credit score is low. Bad credit scores affect borrowing in many ways, such as limiting your access to disability loans. Although, there are plenty of financial options designed for borrowers with subpar credit scores. But be prepared to compare loan offers as many lenders compensate for the financial risk by offering high interest rates. 

Keep in mind the lender may require an active bank account to deposit your money electronically. While it’s possible to cash a government check without a bank account, you may need to open a checking account to receive disability loans. You can quickly sign up for a checking account with minimum fees and even open a bank account with bad credit

What Other Documents Do I Need for a Disability Loan? 

Before signing a loan application, you must provide the disability loan lender with documentation. You can use your disability payment checks as proof of income. However, you still need to provide other identifying documents.

  • Loan Application — The loan application is the initial form you fill out to inquire about emergency cash. Generally, you will need to provide basic personal information. Be ready to provide your name, residential address, phone number, email address, and Social Security number. 
  • Proof of Residence — You will need to provide proof of your residence to sign a loan agreement. Any official government mail is usually acceptable, but you can use other documents that display your full legal name and address. Typically, borrowers provide recent utility bills, lease agreements, bank statements, etc. 
  • Proof of Identity — To prevent fraudulent activity, the lender must verify that you are who you say you are. You must also be older than eighteen to enter into a financial contract. Many borrowers use a driver’s license, state identification card, or U.S. passport.  

What Are My Disability Loan Options?

A disability loan is any loan option that allows you to use your disability payments as proof of income. There are different types of disability loans you can apply for. Your best financial option depends on how much you need and when you want to repay the money you borrow. Read about some fast cash options below.

Car Title Loan

A car title loan is a fast cash option for people who do not have perfect credit. The car title loan lender uses your vehicle as collateral, and the amount you are eligible to receive depends on your equity in the car. Most lenders accept alternative sources of income, such as payments issued by the Social Security Administration. 

While it’s possible to get a lot of money quickly, keep in mind that car title loans are relatively risky. The interest rates can be excessively high, and if you fall behind on payments, you risk losing your vehicle! When a borrower defaults on a car title loan, the lender repossesses the vehicle and sells it at an auction to recoup the unpaid loan balance.    

Personal Loan

A personal loan is a convenient financing option because you can use the money for various personal expenses. Since most personal loans are unsecured, your eligibility will depend mainly on your income and credit score. Suppose you don’t receive a lot of revenue through your disability benefits. You may still get a personal loan if your credit score is Tier 2 or higher. 

Cash Advance Payday Loan

Cash advance payday loans are short-term loans that provide fast financial relief to individuals with almost any type of economic background. Lenders that provide cash advance payday loans typically base eligibility on your ability to repay the loan, not your current credit score. Suppose you can repay a payday loan. In that case, you can get a single payment loan against your next Social Security disability payment. 

The downside is that payday loans tend to have predatory repayment terms. Due to high interest rates and extremely short repayment periods (two weeks), many borrowers who get payday loans get stuck in a debt spiral.     

How To Get the Best Disability Loan?

If you want to get quick emergency relief with your disability benefits, you may wonder how to get the best disability loan. The best loan depends on your repayment preferences and current financial background. However, you can narrow your loan options by comparing loan amounts, interest rates, and repayment lengths.  

Compare Loan Amounts

Before applying for disability loans, knowing exactly how much you need to borrow is essential. Ultimately, the more you borrow, the more you have to pay. The lender will charge interest on the total loan balance, so you will pay more for borrowing a large sum. You may also stretch your finances too thin if you borrow more money than you require in your bank account to pay bills and large purchases. 

Suppose you need $1,000 to cover your monthly bills for a brief period. It may not be wise to accept a $2,000 loan. Taking on more debt than you need can cause you to fall behind on monthly payments and default on the loan.  

Compare Interest Rates

The interest rate borrowers obtain on disability loans determines how difficult the repayment process will end up being. When the interest rate is too high, your monthly payments will also be too high. The best loan will have decent interest rates, so you don’t end up spending a lot on interest fees. 

For example, suppose you get two loan offers for $2,000. One has a 25% APR, and the other has a 99% APR. That’s an annual difference of $1,480! The best disability loan helps you save money on interest fees. 

Compare Repayment Terms

Decide how much time you want for repayment before you pick a disability loan. A short repayment term will cost less because you typically pay fewer interest fees. However, choosing an extended repayment length can help you get lower monthly payments. Deciding whether you want to spend more now or later can help you choose the best loan option. 

FAQs on Disability Loans 

Can I use disability payments as my sole source of income for personal loans?

Yes, many lenders accept disability payments as a valid form of income. However, each lender has its own criteria, so it’s essential to check their specific requirements. Your eligibility for personal loans may depend on the amount you receive in disability benefits and other financial factors.

Are there specialized lenders for people receiving Social Security disability payments?

Yes, some lenders specialize in providing loans to individuals who receive Social Security disability payments. These lenders are more familiar with the Social Security Administration’s payment structure and may offer more flexible terms.

How do payday loans work with disability benefits?

Payday loans are short-term loans that you can secure against your next disability payment. Payday loans are generally easier to qualify for but come with high interest rates. Make sure to read the terms carefully and understand the repayment schedule to avoid getting caught in a debt cycle from payday loans.

What happens if I default on a loan while receiving Social Security benefits?

If you default on a loan, it could have severe consequences, including damage to your credit score and potential legal action. However, most types of Social Security benefits are protected from garnishment. It’s crucial to consult with a financial advisor to understand the implications fully.

Can I get multiple loans while on disability?

Technically, yes, you can apply for multiple loans while receiving disability benefits. However, taking on multiple loans increases your financial risk and could make repayment challenging. Lenders will also consider your debt-to-income ratio, which will include all your existing loans and disability payments.

Are there any restrictions on how I can use the loan money?

Generally, personal loans offer the most flexibility on how you can use the funds, whether it’s for medical expenses, home repairs, or other personal needs. However, some loan types, like car title loans, may have restrictions. Always read the loan agreement carefully.

How can I improve my chances of getting approved for a loan?

Improving your credit score, having a co-signer, or offering collateral are some ways to enhance your loan approval chances. Also, make sure to have all required documentation, including proof of your Social Security disability payments, to expedite the application process.

CreditNinja – Your Trusted Guide to Disability Loans

Learning how to survive a recession with disability payments can be challenging, but you don’t have to go it alone. At CreditNinja, we’re committed to empowering you with the knowledge and tools you need to make informed decisions. Whether considering personal loans, payday loans, or other financial options, understanding the nuances of SSI and SSDI can make all the difference.

Remember, your disability benefits are there to support you, and they can also serve as a valid form of income for disability loans. However, it’s crucial to weigh the pros and cons carefully, compare loan offers, and consider your repayment ability. 


  1. Unfit for Work │ NPR
  2. A Guide to Supplemental Security Income (SSI) │ SSA
  3. What’s the difference between SSDI and SSI? │ AARP
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