Skip to content
Did you know your browser is out of date?
To get the best experience when using our website we recommend that you upgrade to the latest version of one of these browsers.

Loans for young people

Loans for students and graduates

Most of us find ourselves strapped for cash as a student or when we start our first job

By Mehdi Punjwani

Published: 10 November 2020

Young male student studying in a cafe

Ready to compare?

You can apply for a personal loan once you’re 18, but if you’re aged between 18 and 24 you may find it harder to qualify for a low-rate loan.

So whether you want to buy a car, start a business, or fund a training programme, it’s even more important to shop around to find the best deal.

Before taking out a personal loan, you could also consider alternatives such as using your current account overdraft facility, taking out a credit card, or borrowing from relatives.

Can I get a loan at 18?

Almost all UK lenders offer personal loans for 18 year olds. However, to qualify for some deals, you’ll have to be older, say 21 or 25. You’ll also need to be a UK resident and have sufficient income to manage the monthly repayments.

You will also have to be at least 18 to apply for other forms of credit, such as a credit card.

48% of young people take out a loan for a car

According to MoneySuperMarket data collected between January and September 2020, accurate as of November 2020

What loans are available to young people?

Most personal loans are available to young people aged between 18 and 24, but that doesn’t mean you’ll qualify for all of them. When you apply for a loan, the provider will check your credit rating to see if you have a good record when it comes to paying your bills and debt repayments on time.

If this is your first time borrowing money, there will be nothing to see. This doesn’t mean you have a ‘poor’ credit score, it simply means you have little in the way of credit history.

The best deals are reserved for borrowers with sparkling credit files and a history of making reliable repayments. So if you have ‘no credit’ score, also known as a ‘thin credit file’, you are likely to face higher interest payments. In many cases, the amount you can borrow will also be smaller than someone with a more established credit rating.

How do loans for young people work?

Loans for young people are simply standard personal loans that are available to those aged under 25. You'll pay back the amount you've borrowed – the capital – plus interest on the capital sum.

However, if you don't stick to the repayment plan, you'll face charges, so make sure you can meet the cost – and find out how much you could borrow – using our Loan Calculator.

As a young person, other types of loans you may be able to qualify for include:

  • Student finance (as long as your course meets the requirements)
  • A postgraduate Master’s Loan (if you’re studying for a full or part-time master’s degree)
  • A guarantor loan (with which a family member or friend ‘guarantees’ to cover the payments if you can’t)
  • Car finance/leasing (car loans for young people are available if you have enough income to manage the repayments)
People aged 18-24 looked for loans of £5000 on average


According to MoneySuperMarket data collected between January and September 2020, accurate as of November 2020

Should I take out a loan for young people?

A loan for young people can be a great way to get the cash you need to move on to a new phase in your life. According to MoneySuperMarket data, 48% of young people enquiring about a loan are doing so to help fund the purchase of a car. *

But before applying for a loan, consider how much you really need to borrow and what repayments you can afford to make each month – it's important not to overstretch your finances. Then ask yourself how badly you need the money right now. Could you save up for it, or maybe borrow it from a relative or friend? It could make things a lot easier and cheaper if you can – as long as you keep up your end of the deal.

Other options worth looking into include using a current account overdraft facility and taking out a credit card – although both will often prove more expensive than a loan if you’re looking to borrow longer term.

*Data collected by MoneySuperMarket between January and September 2020, accurate as of November 2020

How can I improve my chances of getting a loan for young people?

The easiest way to improve your chances of getting a loan is to take action to boost your credit score. Simple steps you can take to do this include:

  • Checking your credit file to ensure there are no mistakes – you can do this for free with MoneySuperMarket’s Credit Monitor service
  • Paying any bills in your name on time all the time
  • Making sure your name is on the electoral roll by registering with your local authority
  • Paying off any other debts you might have
  • Avoiding rejected applications damaging your score by checking how likely you are to be approved using our Eligibility Checker

Compare loans for young people

It’s easy to find and compare loans for young people with MoneySuperMarket. Just enter a few details such as how much you want to borrow and over what timeframe, and we’ll show you a list of deals from more than 40 UK loan providers.

Give us a few more details about your personal circumstances, and we can also filter the results to only show you deals you’re likely to be offered.

MoneySuperMarket is a credit broker – this means we’ll show you products offered by lenders. We never take a fee from customers for this broking service. Instead we are usually paid a fee by the lenders – though the size of that payment doesn’t affect how we show products to customers.

Ready to compare?