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Getting a loan as a young person can be difficult, but there are still a range of options for you to choose from. Loans for young people are generally in the form of student and personal loans, but there are other options available.
Loans for young people can be obtained in a variety of different ways. Young people often struggle to get loans as they have no credit history and often are seen unfavourably by credit agencies, as they cannot verify if they have the capacity to pay. However, it is still possible to get a loan as a young person – you just need to know which loans you can get.
In this article, we will be outlining the loans available for young people, how to get a loan with no credit, and the advantages and disadvantages of getting a loan as a young person. As with all loans, you should make sure that you need the loan, and that you are able to pay back the loan at a future date.
You need to be 18 years old to get a loan. Larger loans generally available to people 21 and over, due to the fact that a young person’s income may not always be consistent or verified.
However, if you want to get a loan as an 18-year-old, then most lenders can offer personal loans to you, but you must be at least 18. If you are looking for a loan as a 16 or 17-year-old, then you will have to wait, as you cannot apply for a loan or any other form of credit in the UK if you are under 18.
There are many different types of loans available for young people, each serving a different function. Here is a breakdown of the most common types of loans.
The first loans that young people encounter are often student loans. University can be expensive, and often young people need loans to help them pay for university costs which could simply be food, accommodation and university resources. Student loans are widely available and can be easily obtained for people who are studying.
Some personal loans are available for young people. With Creditspring, you can apply for a personal loan if you are over 18 and have a regular source of income.
Even if you don’t have a credit history, it is still possible to obtain a personal loan. Lenders consider a wide range of criteria when checking applicants essentially to assess how likely you are to pay back the loan. If you are a young person with a stable income and a fixed address, then it is far more likely that you will receive a loan.
There are credit cards available for young people, but just like a personal loan, you will need to be 18 to get a credit card. If you are under 18, then you cannot obtain a credit card. You can be added as a second card user on a parent account, but this account will still be under the care and responsibility of a parent.
Student credit cards are also an option for young people, which are just like regular credit cards except with lower credit limits and various perks aimed towards students. For a student credit card, you will still need to be at least 18.
Credit builder loans can be one way that a young person might be able to build up their credit score from zero. These can also come in the form of bad credit loans.
These loans are specifically designed to help build up a good credit score by offering manageable payment instalments that can be paid back easily, proving to future lenders that you have the capacity to pay back your loans on time.
Co-signers are essentially like a guarantors on a loan. A co-signer on your loan will agree to repay the loan if you cannot, so they can provide security for the loan.
As a young person, you may need a loan, so you could secure one via a co-signer, and obtain the same loan with extra security. A co-signer with a strong credit history will also make your application much more attractive.
Make sure that anyone you put down as a co-signer understands their obligations fully, as they will be responsible for the entire loan if you default.
Secured loans will require collateral which will then be used as payment if you default on the loan.
Unsecured loans are slightly harder to obtain and will have higher interest rates. If you are trying to obtain a loan with no assets and no credit, this may be a better option for you, however, you might be more at risk from higher interest rates. Demonstrate financial responsibility The fastest and best way to obtain a loan as a young person is to demonstrate financial responsibility and that you are good with money.
This could include:
Having a stable job with a regular income
Owning assets which can be used as collateral
Using financial products effectively such as credit cards
This will also help you get better at paying the loan yourself and not getting into any financial troubles that can spiral into further debt. You can also build a good relationship with a bank, which will help you obtain bigger and more favourable loans.
One way that a young person can obtain a loan unofficially is by asking a friend or a partner to borrow money. However, borrowing from a friend, girlfriend or boyfriend is generally not advised. Borrowing money from those close to you can create an uneasy relationship, particularly if the money is not paid back on time. Therefore, we advise that if you are going to borrow money from someone, that you create a written agreement, which can include:
Your name and the borrower’s name
The date the loan was granted
The amount of money being lent
Payment due date
Consequences for defaulting on the loan
This will ensure that everyone is clear about the loan and that the relationship does not go south.
We also have more about lending money to family.
Taking out a loan as a young person can be a great solution to early financial problems that you might have. For example, you could use a loan to pay for a car repair so that you can keep a job, or repair or replace a damaged phone.
Repaying back loans as a young person can also help you build up a good credit score for when you come to larger loans in future.
As a young person, you are unlikely to be offered the best interest rates, as you have nothing to demonstrate that you can pay your loans back. This means that it will likely be more expensive to borrow.
Defaulting on your loan will also damage your credit rating early on, and as your credit rating is entirely new, you could have a tarnished record very early on in your life.
Furthermore, loans can get people into difficult financial situations and leave them struggling, which then limits their potential for growth even further. As a young person, you are especially vulnerable to this, and if lenders take legal action against you for failing to repay your loans, this could mean your financial journey has a very rocky start.
Therefore, if you are looking for a loan as a young person, it is important to do as much research and calculation as possible to make sure that a loan is the best option for you.
The minimum age to get a loan in the UK is typically 18. At this age, you can apply for most financial products, such as personal loans, credit cards, and student loans. It's important to consider your ability to manage repayments before taking on any debt.
Yes, Creditspring offers loans to individuals aged 18 and over, including those under 21, provided they meet the eligibility criteria. Creditspring is designed to help young people build credit and manage borrowing responsibly, offering a structured repayment plan that avoids high-interest rates.
Improving your credit rating at 18 starts with responsible financial habits. Open a basic bank account, set up direct debits for regular payments like a mobile phone bill, and ensure you pay these on time. Consider getting a credit builder card, using it for small purchases, and paying off the balance in full each month. Register on the electoral roll at your current address to boost your credit profile. Over time, these steps will help establish a strong credit rating, making it easier to access financial products in the future.
At Creditspring, we have a range of loans designed to help people achieve financial stability. We only offer loans that are manageable and that can be comfortably paid back.
We offer loans that are manageable and that can be comfortably paid back, with two no-interest loans per year where instead of interest you pay a monthly membership. After 14 days, you will be able to decide if you want to be a member. After that, you will have to pay each month.
If you are a young person looking for a loan, we advise that you assess why you need the loan and how long for. Once you have all the information you need, then you can make a decision about the kind of loan you need.
Creditspring offers a wide variety of loans to cater to different audiences. Depending on your situation, we may be able to offer even loans for people on benefits.
Check your eligibility below. This is a soft credit check, so will not affect your credit score.
