Ask HN: Advice on my financial situation?

I'm a CS grad who's never had a programming job and who's been unemployed since April. Unemployment services told me in June that I hadn't worked enough in the past two years to get anything from them. They told me that if I registered with them, it'd take me 6 months to get any money. At that time I was being taken on a 2nd interview by two companies, so I figured, I'd rather focus on that. I also started doing freelancing for an entrepreneur. He needed somebody urgently and there wasn't much work at the beginning so I told him we'd worry about money later on.

A few months forward, I still don't have a job and I'm getting broke. I've done many more hours of development for this guy, at an absurdly cheap rate. I did these in hope they'd improve me resume. My problem is, he still haven't paid me anything. He always seems nice, but then postpones it. He doesn't have much money himself, and I do am asking him to do a full-fledged contract, so that unemployment services would recognize it and skip the 6 months delay - this has a cost as he has to pay somebody else to do the paperwork. We had a group phone call with that person in August where we agreed on the principle.

I have two possibilities right now. 1. I asked him to send me money without doing a contract, so that I could buy food and pay rent a few more months, hoping I find a job before that dries out as well. This seems to meet less resistance with him, but will he actually pay? 2. The code I've been working on is on my server, he's using it to show it to clients, meaning I could shut everything down until I get what I need.

What do I do?