To Get A Loan As A Teenager, your parents must co-sign the loan and you need to explain to the bank or credit union your intention for the loan properly. However, you have to be above 18 to get the loan.
Getting a loan as a teenager is one of the hardest tasks even if you are 18. Because teenagers don’t have a credit score to get a loan and you can’t build a credit score without taking a loan.
However, getting a loan as a teenager is not an impossible task either unless you are below 18. You just need to go the extra mile to get it. But how?
In this article, I am going to explain some of the most effective ways on how to get a loan as a teenager in 2022 along with all the related queries. So, stick here till the end.
Let’s start by answering can you take out a loan as a teenager?
Can You Take Out A Loan As A Teenager?
Yes, it’s possible to take a loan as a teenager. But you must be 18 or above. If you are under 18 you can not take a loan. Because according to U.S law,
“Anyone under the age of 18 is considered a Minor and a minor by law can’t enter into a contractual agreement with a lender.”
Moreover, a 18 year old does not have a credit score. So, to get a loan your parents or legal guardian must co-sign a loan with you. Otherwise, banks or credit unions won’t grant you a loan.
But can a 16 year old get a loan with a co-signer?
Can A 16 Year Old Get A Loan With A Co-Signer?
No, a 16 year old can not get a loan with a co-signer in the US. Because legally a 16 year old is considered a minor. So, most financial institutions or lenders will not be involved in signing a loan with a minor.
As a result, the only loans for 16 year olds can be loans from family members. So, if you are a 16 year old and looking for a car or small personal loan, ask your family members or relatives.
Moreover, some credit unions must allow you loans if you are 16. This is How to get a loan under 18.
Can A 17 Year-Old Get A Loan With A Co-Signer?
No, a 17 year old can not get a loan with a co-signer. Because 17 year olds are still a minor. So, they can not get any institutional loans.
So, any 17 years in need of a loan should ask their parents or legal guardian or find a credit union. That’s how to get a loan at 17 and can be the only viable solution.
If you want a small loan as an adult, check our article on payday loans.
Now that we have learned whether you can get a loan as a teenager or at which age can you get a loan. So it’s time to find out how to get a loan as a teenager.
How To Get A Loan As A Teenager
To Get A Loan As A Teenager, firstly you need to fulfill some criteria
- Your age have to be 18 or above.
- You must need one of your parents or legal guardian as a co-signer for the loan you are taking.
If you fulfill the above criteria only then you can apply for a loan. However, how to get a loan at 18 with no credit successfully depends on many other factors. Now I am going to explain how to successfully approve different types of loans as a teenager.
Car Loans
Car or auto loans are the most common type of loans a teen take. To get a car loan successfully follow the below steps
- Firstly, find a bank or financial institution your parents have financial relations with. Because it will make the process a lot easier for you.
- Secondly, go to the financial institution you have chosen and talk to the loan officer to find out what you will require.
- After that get all the necessary documents and manage your parents to co-sign the loan.
- Lastly, go to the loan officer submit the loan application and wait for approval.
If you follow the above way properly your loan should get approved.
Moreover, instead of banks try to choose a credit union for auto loans. Because they offer much better loans for teens than banks. For example, SEC Federal Credit Union offers as much as $25,000 in auto loans to teens.
However, if you choose a credit union then your parents must be a member of the credit union.
Personal Loans
Though personal loans are easy to get for adults. However, for teens, they are quite difficult to obtain.
The application and loan process is pretty similar to auto loans. Because you will require an adult co-signer, some documents and you have to be 18 or above. However, when applying for a personal loan you have to explain to your lender why are you getting the loan and the reason must be valid. Only then there is a high chance of getting the loan approved.
You can also try credit unions for personal loans as a teenager. Because their policy is a bit more relaxed than banks.
Student Loans
Student loans are one of the most accepted loans a teen can get. They are also easy to get with valid documents. There are two types of student loans in the US
- Federal Student Loans
- Private Student Loans
Here, federal student loans have lower interest rates. There is no age limit either, But you must have a High school diploma or GED. However, federal student loans are quite hard to get. Here, you can find more details about how to apply for federal student loans.
On the other hand, private student loans are easy to get. But they have a lot of requirements like you must be 18 or older, must have a creditworthy cosigner, etc. Private student loans have high-interest rates too.
If you have a loan as an adult, then check our article on debt collection.
This is how to get a loan as a teenager.
In Summary
Taking a loan as a teenager is hard but not impossible. So, if you are no other options then you can try the above methods.
However, taking a loan in your teenage years is a big financial diction. Before deciding on taking a loan talk to your parents or a financial expert and make a plan on how to repay the loan you intend to take.
That’s it for today. Have a nice day!
