Minors

If you’re under 18 years old you can apply to borrow money or buy goods on credit as long as you meet the creditor’s conditions, which may include providing a co-borrower or guarantor.

Most contracts are not enforceable against minors. The contract can only be enforced if a Court or Disputes Tribunal says that it is fair and reasonable. When deciding whether a contract is fair and reasonable, the Court will consider:

• the circumstances around which the contract was made
• the subject-matter and nature of the contract
• in the case of a contract relating to property, the nature and the value of the property
• the age and the means (income or property) of the minor
• all other relevant circumstances.

What do I do if I signed a credit contract and now wish I hadn’t?

If you are under 18 years old the contract can’t be enforced unless the creditor takes you to Court and proves that it is fair and reasonable. This applies to all contracts, not just those involving credit. If you need help persuading the creditor that the contract is unenforceable, you may wish to use the content below for a letter and/or get advice from a community law centre.

Contact details for Community Law Centres.

Example letter to cancel a consumer credit contract if you are a minor:

I have signed a contract with your company. At the time I signed this contract I was under 18 years old. As I am a minor, this contract is unenforceable against me. I refer you to the Minors Contracts Act (1969) section 6. Section 6(3) of the Act provides that this contract can only be enforced against me, a minor, if you take the matter before a Court and prove that the contract is “fair and reasonable”. The contract is unenforceable and this letter is to inform you that I wish to cancel this contract. Please confirm that you accept my cancellation.

Write to the manager and include the date that you are writing. Include any reference numbers that the creditor has given you and sign your name at the bottom of the letter.