Getting a loan when you are young and with no credit history can be so challenging. However, when you have no previous credit records, there are just a few lenders who can entrust you with their money.

The lenders do not know whether you will later turn to be a good borrower or a joker. Well, but everyone out there who can borrow a considerable amount of money started from somewhere. So they have already built their trust with the lenders, and that's what you should do.

Let's know where these big borrowers started.

Payday loans

A payday loan is a short-termed loan that a borrower gets based on his income. To get a payday loan, you must provide evidence of regular income and an active checking account.

It means that a young person who is starting to borrow can get a payday loan. However, payday loans are associated with high interest rates of up to 391%, whose calculations are APR-based.

The payday alternative loans (PALs)

You can get payday loans online when you have no previous credit history. The credit unions that give PALs do not run credit checks. In addition, they have a lower APR of up to 28% compared to Payday loans which may go up to 391%.

Online lenders

Some apps can lend to young people without credit history as long as the borrowers are employed. Some of those apps are:

a. Earnin

This app gives small amounts of loans ranging from $100 to $500. Only those who are employed can access Earnin loans. The best thing about earning is that they don't charge fees or interest to the borrowers.

b. Brigit

Having paid Brigit's membership fees, you can qualify for a loan of up to $250. In addition, Brigit offers budgeting tools to its members.

c. Stilt loans

Stilt can give a loan to any young person without a credit history. It also loans migrants and undeserved people who have low credit scores.

Get a secured loan

If you have an asset somewhere, you can use it as collateral when applying for a loan as a young person. As a result, it will not be hard for the lender to trust you and increase your creditworthiness as time passes by.

A cosigner

If you cannot get a loan when you have no credit history, you can consider getting a cosigner who can help you get a loan. You will get a loan through then provided that you prove to pay it on time.

Compromising to pay a loan taken through a cosigner, you will be compromising their credit score. Therefore you better think again before involving a third party in your loan.

Conclusion

As a young person with no credit history, apply for a loan that you can comfortably pay on the agreed time. It will significantly help to build the lender's trust in you.

Only take loans for emergency occurences and not enjoy yourself at a birthday party. It's a bad idea!