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Getting a loan as an 18-year-old is often more difficult than simply applying and being approved. You probably have little to no credit history, little savings and might not have a high-enough income to meet many lender’s eligibility requirements. So what are your options if you’re an 18-year-old who needs a loan? Read our guide to find out.
While your options might be more limited than more experienced borrowers, you might be able to qualify for one of the following options:
Follow these steps to up your chances of getting approved:
Chances are you don’t know what your credit score is, let alone your credit history. Having an idea of what your credit history looks like will help you determine which lenders you qualify to borrow from. Getting an estimation of your credit score can help.
Most reputable lenders tend to be wary of lending to people who don’t have a source of income. Even having a small part-time job can help you get approved for a loan since it shows that you’re generating at least some income. Look for jobs you’ve had in the past or currently hold that can boost your application.
You don’t necessarily need a cosigner to borrow at 18, but it could help you borrow higher amounts at more competitive rates than if you applied alone. Reach out to family members and friends that have a stronger credit history than you to find out if they’d be willing to help you out. This will help you narrow down your choices: Not all lenders allow cosigners on personal loans.
Not from your typical personal loan provider. However, some alternative lenders offer loans designed for students that consider factors like your college GPA and earning potential rather than your credit score. And if you’re in school, you can also use part of your student loans to cover living and personal expenses after you’ve paid your school’s tuition and fees.
It’s generally a good idea to compare lenders if you want to find the most competitive loan. It’s almost essential for you:Finding a lender that either accepts cosigners or is willing to lend to someone with little-to-no credit history can be difficult.
Compare the following features to find the most competitive loan you can qualify for:
Many lenders allow you to apply for preapproval — also known as prequalification — by filling out a simple application. It’ll let you know if you qualify and often give you an estimate of the APR, loan amount and loan term you can expect without doing a hard credit check.
Hard credit checks, also known as hard credit pulls or inquiries, can make your credit score take a temporary dive and will make it more difficult to qualify for another loan.
Be sure to be accurate when you’re filling out your application — one of the top reasons people get rejected for loans is mistakes in the application. Re-read it a couple of times to make sure there are no inconsistencies.
If you’re accepted, it’s also important to read the terms and conditions of your loan before you sign your loan documents. If you’re having trouble understanding it, reach out to your lender or ask a friend or family member for help.
It depends on where you live. In most states, you must be 18 or older to get a loan. However, in Alabama and Nebraska you must be at least 19 to take out a loan. In Mississippi, the minimum age is 21.
If you’re 18, chances are you don’t have a credit history — you weren’t old enough to build a credit score until this year. In most cases, no-credit borrowers need to bring on a cosigner to help you meet basic credit requirements. Otherwise, you might want to consider alternative lenders.
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