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I'm 15 and traveling to Hungary for Christmas. And my parents are paying for half my ticket because that's all they can afford. I have to pay for the other half and have enough for spending money. But I only get 2 shifts a week on an average pay wedge. I'm too young to take out a loan, I know, but can my parents take one out for me? Like charge the loan to my account?

Ben Miller
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Kitana
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    If you can't afford to go to Hungary, don't go to Hungary... – Bobo Oct 01 '14 at 15:52
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    Of course, he could choose to go hungry, to save to go to Hungary, but I wouldn't recommend it. – atk Oct 01 '14 at 19:29
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    Your parents want to pay for half the trip which is... enough to get you there only? –  Oct 02 '14 at 01:24
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    Bobo's right. Don't buy stuff you cannot afford. – Mason Wheeler Oct 02 '14 at 20:27
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    I don't know how much more you need, but you could consider asking friends and extended family for gifts instead of loans to help you make this trip, especially if the trip is very significant for you (i.e. visiting relatives you haven't seen in a very long time; not just touring eastern Europe). You might not get all the remaining money that way, but if everyone just contributed $25-50 and you only needed $1K, that could potentially make up a substantial chunk of it. – Doktor J Oct 03 '14 at 00:38
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    You and your family will be much better off if no debt is involved. Time to get creative. Try one of those "funding" sites where you can ask the internet to crowd source the remainder of your trip. Or wait a year and try to pick up odd jobs to make up the difference. – mikeazo Oct 13 '15 at 13:41

4 Answers4

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It may seem like you cannot live without this trip, but borrowing money is a bad habit to get into. Especially for things like vacations. Your best bet is to save up money and only ever pay cash for things that will decrease in value.

Please note that while it is a bad idea to borrow money for things that decrease in value, the "opposite" is not necessarily true. That is, it is not necessarily a good idea to borrow money for things that will increase in value; or, will earn you income.

False assumptions can cloud our judgement. The housing bubble and the stock market crash of 1929 are two examples, but there are many others.

Pete B.
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    +5 million, if I could for "pay cash for things that will decrease in value" (suggesting an edit). Personal finance can be boiled down to: only take out a loan if it makes you money (with the exception, maybe, of a mortgage), and help most people improve their lives. – Jay Oct 01 '14 at 23:18
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    A mortgage will save you money if handled right. Over 50 years it's cheaper than renting even if land value didn't go up. – Joshua Oct 01 '14 at 23:28
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    While true, and good advice, it does not answer the question and should probably be a comment. – Konerak Oct 02 '14 at 08:07
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    @Joshua - an unsubstantiated generality. Over the long term, homes have tracked inflation and no more. When expenses, transaction costs, and the fact that people tend to buy more space than they need, the topic itself isn't conclusive. – JTP - Apologise to Monica Oct 02 '14 at 12:34
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    While I generally agree with the response, this answer fails to take into account the fact that perhaps the OP has family (elderly grandparents, etc) that they wish to visit; family members who may be in poor health, for whom a visit cannot be postponed indefinitely until they scrape together the finances for it.

    It also fails to answer the question of whether the OP's parents can take out the loan.

     – Doktor J Oct 03 '14 at 00:34
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    To the flaggers - If you wish to downvote, please do so. This is one of those rare occasions where the answer to "How do I .....?" is just "Don't." The +30 score shows that members agree. – JTP - Apologise to Monica Oct 03 '14 at 13:47
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    @JoeTaxpayer - don't want to get into a holy war here, but it's almost axiomatic that buying is cheaper than renting same property - a landlord needs to profit. The constraints are debatable but the generality is not. – Entendu Oct 03 '14 at 16:00
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    @Entendu - The discussion is tangent to the question in a way that really adds no value. And SE is not a board for ongoing debate. – JTP - Apologise to Monica Oct 03 '14 at 16:06
  • @Jay "Pay cash." Full stop. Always pay cash. Invest funds so that they earn you money. Make them (the money men) pay to use your wealth. When you borrow, you are doing the opposite. Leveraging loans to raise capital for investments is a tricky game. The Donald was known for it. He also bankrupted more than a couple of his companies doing it. It's high stakes financial roulette and best not risked at a personal finance level. – Xalorous Aug 17 '16 at 15:10
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When borrowing a small sum from a bank, there's usually no collateral. i.e. no property to put a lien on, no gems put in a vault. It's a personal loan. A loan for a plane ticket for you or for them wont make a difference. If they have the borrowing ability, it's their loan.

That said, if your family finances are so tight, no one can buy a full round trip ticket, you should not be taking this trip. If your (whole family) savings is not above 3-6 months living expenses, you still shouldn't take this trip.

JTP - Apologise to Monica
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If you're in the US then no. You cannot enter a binding contract therefore you will not get a loan from a bank. Cosigner or no cosigner, anything to do with a loan and a bank will not involve you.

Your parents can get a loan, then they can give you the money, then you can pay them for their payments, but none of that means the loan has anything to do with you. It's their loan, if they default it's on them.

Given your age, you probably will ignore everyone else's advice here about this trip being a bad idea if you can't afford it, but you should reconsider it. You will be paying for this trip long after the fun and excitement has worn off. This is the cycle that sends alot of families into bankruptcy, and it's a horrible habit to learn so young. "Loan" shouldn't even be in your vocabulary dealing with anything other than a library book.

jadoti
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    On the other hand, when I was thirty I could easily afford paying for things that seemed very, very expensive when I was 15. – gnasher729 Oct 02 '14 at 14:15
  • 15 years is a long time to have a debt hanging over your head for a trip – Noah Oct 02 '14 at 19:18
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You can certainly borrow from your parents, and they can take out a loan under their own names if you can persuade them to do so. That really is the best solution I can think of for a loan to a minor... assuming that your parents think the trip is important enough to justify the cost and commitment of taking out a loan at all. (If they don't, they wouldn't co-sign for a loan either.)

Other than that... I think the simple answer is "no". You are probably going to have to find some other way to raise the money, or delay the trip.

(Yes, theoretically there are things that can be done with them guaranteeing a loan on your behalf. But at your age, I don't know whether you would be considered legally competent to sign that agreement in most jurisdictions, and realistically it winds up being no less risky for your parents than the approach I suggested since they're still on the hook if you can't repay in time.)

keshlam
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  • It's not terrible advice IF the parents agree that the loan should be taken out because the trip is necessary. However, I'm betting they will say "no", which brings things to the next paragraph -- if it's important to you, find a way to earn money to close the gap, or find a way to be more realistic about your plans. – keshlam Oct 01 '14 at 20:04
  • (Note that even if the parents could guarantee a loan for an underage kid, they're taking no less risk than if they took out the loan themselves or loaned from their own pockets. In any of these cases, if the kid's late in paying they're out of pocket, and if the kid fails to pay they're the ones who have to make up the difference. The only real advantage of guaranteeing a loan rather than making a loan is that someone else does the bookkeeping unless/until the loan gets into trouble.) – keshlam Oct 01 '14 at 20:11
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    I think the "That really is the best solution" should have the caveat of "if, after considering all alternatives, it's decided the benefits of the trip outweigh the risks and costs of going into debt for it." – corsiKa Oct 01 '14 at 20:34
  • No objection to adding a caveat. – keshlam Oct 01 '14 at 20:37
  • @keshlam, if the kid is 15, any loan contract is voidable. If the kid or the parents void the contract, and the bank wants money from the parents, they can say "what loan? There is no loan". Obviously that means the bank won't give a loan. – gnasher729 Oct 02 '14 at 14:24
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    @gnasher729: As far as the contract exists the "kid" doesn't exist with the solution provided. The parents take out a loan. They give money to their child. The child (hopefully) gives them money back. I would also imagine that deliberately getting a loan you know is invalid would probably involve fraudulent behaviour, potentially getting you in more trouble than defaulting on a loan... – Chris Oct 02 '14 at 16:08
  • @Chris: Contracts with children are voidable to protect children from being exploited. If a well-informed child enters a voidable contract with an adult, counting on the fact that it is voidable, then it is the adult's problem alone. There are absolutely no negative consequences for voiding a voidable contract. – gnasher729 Oct 13 '15 at 22:33
  • @gnasher729: I was working on the assumption that the kid wouldn't actually be entering into a contract with the parents. So parents have contract with bank and that is the only contract involved. The money exchange between child and parents is a good will/good faith thing. This is certainly my understanding of the whole point of this answer. – Chris Oct 14 '15 at 16:40