17 year old member not allowed to take out Loan with CU

T

thanksforhelp

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Hello again.

My son is a CU member with 1000.00 in shares.

He works weekends so has a level of independence. No other loans etc.

He wants to take a loan of 800.00 out from the CU.

They have advised that he cannot do so until he is 18. The only option is for him to take out 800.00 in shares!


They also advise that it's not possible for me to be a guarantor either - its just not possible for him to have a loan in his name.

I find this hard to believe tbh.

Is this the situation in all CUs or just the one we are in?



Many thanks
 
You can't enter a legally binding contract until age 18, I imagine every lender has the same rule.

Why not use the savings? Is this not the point of saving up for things, to have it when you need it. He could be disciplined enough to then put away each week what the repayments would have been, best of both worlds, build back up the savings and no interest charge.
 
I'd agree, a person under 18 can't get a loan.

Take the 800 from savings and then pay back in the amount of the loan repayment and he will have more than €1,000 at the end!
 
Definitely has to be over 18 to take out a loan.
It seems a no brainer to me to take the money from the shares @ 0% interest & pay it back whatever way he wants rather than borrowing @8% & paying back the way they want it.
 
In the past the way this was handled was by parents going guarantor when they are over 18 but in your name while they are 17. I think the parent needs to go and have a chat with the manager. Better for a child to learn about borrowing and learn to pay it back and make a mistake now rather than later for an amount that is considerable.
 
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