When you want to make a major purchase - whether it's a car, a home or an education - you’ll probably have to get a loan to help pay for it. That can be especially difficult for younger consumers because lenders generally won't make loans to people under age 18.

Lending and Age

Everyone is considered a minor in the eyes of the law until they reach age 18. As a minor, you generally can't be held responsible for a contract you sign. That means lenders won't make loans to people under 18 because minors have no legal obligation to repay them.

Student Loans to Minors

Although minors generally can't sign binding contracts, federal student loans are an exception. A change to the Higher Education Act in 1992 permitted students under age 18 to sign legally binding contracts for their own federal loans, helping minors finance an education without the help of an adult.

Credit History

Even if you are 18 or older, there's no guarantee a lender will give you a loan. They'll look at your credit history first and chances are you won't get a loan without a solid credit background unless you can make a large down payment - cash you put toward a purchase to reduce the amount you need to borrow.

Co-Signers Required

In addition, lenders often require that younger borrowers with little or no credit history find a co-signer before approving loans. A co-signer is someone that signs on to a loan contract and agrees to pay if the primary borrower doesn't or can't repay the loan themselves. For example, if your parents co-sign a loan for you and you fail to make payments, your parents are legally obligated to make the payments for you.