Loan Before 18? Here's How to Get Approved Fast (2026)

Are you under 18 and wondering if you can get a loan in Australia? Whether you're looking to buy your first car, start a small business, or simply need to manage an emergency expense, understanding your options and limitations is crucial. While obtaining a loan as a minor can be challenging, it's not entirely impossible. Let's explore how you can achieve your financial goals even before reaching adulthood.

Understanding Loans for Minors

In Australia, the legal age to enter into a contract, including a loan agreement, is 18. This means that lenders typically require borrowers to be at least 18 years old before considering them for a loan. However, there are certain exceptions and alternative options that minors can explore. Understanding the basics of these financial products is the first step towards making informed decisions.

Loan Options and Rates for Minors

If you're under 18 and need a loan, there are a few pathways you can consider. Each option comes with its own set of requirements, benefits, and challenges. Here's a closer look at what's available:

Let's break down these options:

• Joint Loans: A parent or guardian can co-sign the loan, which means their creditworthiness will be considered alongside yours. This can help you qualify for a better rate.
• Guarantor Loans: Similar to joint loans, a guarantor will vouch for you. However, they are only responsible for the loan if you default, making it a slightly different commitment.
• Bank Accounts with Overdrafts: Some banks offer overdraft facilities on youth accounts, allowing limited borrowing under parental supervision.

Steps to Secure a Loan Before 18

Here’s a step-by-step guide to help you navigate the process of securing a loan as a minor:

1. Assess Your Financial Needs: Clearly define why you need the loan and how much you need to borrow. This will help you choose the appropriate loan type.
2. Explore Joint or Guarantor Loan Options: Discuss with a parent or guardian if they are willing to be a co-borrower or guarantor.
3. Research Lenders: Look for banks or financial institutions that offer joint or guarantor loans. Esteb and Co, with access to over 83 lenders, can provide guidance on the best options available.
4. Prepare Necessary Documentation: Gather necessary documents like proof of income, identification, and details of your co-borrower or guarantor.
5. Submit Your Application: Apply for the loan with the chosen lender. Ensure all details are accurate to avoid processing delays.
6. Review and Sign the Agreement: Once approved, review the loan agreement carefully. Make sure you understand the terms and conditions before signing.

Tips and Considerations

Navigating loans as a minor can be tricky, but here are some expert tips to keep in mind:

• Build Credit Early: Consider getting a low-limit credit card with a parent as a co-signer to start building your credit history.
• Understand the Risks: Ensure you and your co-borrower or guarantor understand the financial risks involved, especially the responsibility of repayment.
• Seek Professional Advice: Consult with a mortgage broker like Esteb and Co to explore suitable options and avoid common pitfalls.
• Consider Alternative Funding: Look into scholarships, grants, or part-time work as alternative ways to fund your needs without incurring debt.

Frequently Asked Questions

1. Can a 17-year-old get a loan in Australia? Generally, you must be 18 to take out a loan, but exceptions like joint or guarantor loans may be available.
2. What is a guarantor, and how does it work? A guarantor is someone who agrees to repay the loan if the borrower defaults. Their creditworthiness is crucial.
3. Are there any no-credit check loans for minors? Most lenders require a credit check, but joint loans may rely more on the co-borrower's credit.
4. How can I build credit before turning 18? Consider a secured credit card or become an authorised user on a parent’s credit card account.
5. Is it better to wait until I'm 18 to apply for a loan? It depends on your immediate needs and financial situation. Consulting with a financial advisor can help make this decision.