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Why December 2021 Is The Best Time To Take Out A Personal Loan

Jessica Cotzin Updated: June 27, 2023 • 5 min read
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Personal loan rates are currently at an all-time low, so if you’ve been thinking about taking out a loan in the near future, now is a great time to do it. The Fed has kept its benchmark lending rates very low over the past two years, which has affected the economic climate overall.

The average interest rate for a personal loan currently is down to 10.46 percent, which is incredibly low when compared to historic personal loan rates. Average rates for personal loans have gone down significantly in the past 20 years.

The average rate for a personal loan in 2000 was over 13 percent, and while there has been some fluctuation in rates since then, rates have consistently gone down.

In short, if you need some extra funding for an upcoming vacation, home renovation project, or something else, there’s no time like the present to take out a personal loan.

Let’s break down why December 2021 might be the best time to take out a personal loan.

What to Know About Personal Loans and Its Advantages

Personal loans are a form of credit that borrowers can secure from banks, credit unions, and other online lenders. Unlike mortgage loans which you can only use to purchase a home, personal loans can be used for virtually anything.

Many people use personal loans for major life expenses, such as hosting a wedding or starting a business, and because they often come with lower interest rates than credit cards, it’s fairly common to use a personal loan to consolidate debt.

These low-interest rates make personal loans a very attractive option when compared to other forms of credit. They also tend to be more flexible and come with higher borrowing limits, especially for applicants with good credit. Even if you have a steady income, there are times when you might need a bit of extra cash in order to meet your goals.

A personal loan with bad credit is also possible, it just might take some extra time to shop for the best rates or you can apply with a co-signer.

  • Fixed APR: 6.99 - 35.99%
  • Loan Term: 12-84 months
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  • APR: 8.99-25.81%
  • Loan Term: 24-84 months
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  • APR: 5.99-35.99%
  • Loan Term: 2-72 months
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Are there any risks involved?

Borrowing money always comes with some level of risk, and personal loans are no different. When taking out a personal loan, you want to budget carefully to ensure you can afford the monthly payments.

The monthly payments for personal loans tend to be higher than the minimum payments for credit cards. You’ll also need to factor in the fees and interest rates for the specific loan you’re interested in to make sure you can pay it off over time.

Why December 2021 May Be A Great Time to Take out a Personal Loan

If you have been considering taking out a personal loan but have just been waiting for the right time, December 2021 might be the right time to take the leap. Rates are currently at historic lows, but it’s unclear how long it’ll last. So taking out a loan now ensures you’ll be able to secure the best personal loan rates.

During the COVID-19 financial crisis, the U.S. Federal Reserve has taken precautionary measures to keep interest rates low. They’ve done this in order to stimulate the economy. By making loans accessible to a wider range of consumers, they keep money flowing and prevent the economy from falling even further.

Although the world is slowly healing from the pandemic, it’ll take time for the economy to fully recover. This is why interest rates have stayed so low all the way into December.

However, these rates will likely go back up again as the economy heals. Because things are changing quickly, now is a good time to take advantage of these low-interest rates.

interest rates chart

What You Should Look for in a Personal Loan

Because there are so many different banks and credit unions that offer personal loans, it can be difficult to determine which one is going to be the best for your needs.

It’s best to shop around and do an in-depth comparison of all of your options to ensure that you are getting the best possible rates.

Here are some of the key features to look for when taking out a personal loan.

Interest Rates and Fees

When shopping for a personal loan, a low-interest rate is one of the most important things to consider. The exact interest rate on your loan is going to depend on your credit score and other financial factors, but can still vary widely between banks. You should compare interest rates online before you submit a final application.

It’s also important to check for hidden fees when shopping for a personal loan. Ideally, your loan shouldn’t have any fees, but some lenders charge processing fees. Hidden loan fees aren’t always obvious and you may need to read the fine print in your loan documents in order to find them.

Payment Terms

Another important factor to consider is the payment terms of the loan. How much will you need to pay every month and how long will it take to pay off the loan? Some loans offer flexibility when it comes to payment terms, but many do not. You’ll want to make sure that your loan’s payment terms work with your budget.

Required Credit Score

Most loans require applicants to have a certain credit score. Some will also have specific income requirements. These requirements are usually available online, so you can check to make sure you qualify before you apply.

Customer Service

When selecting your loan, it’s important to find a lender that provides excellent customer service. The process of navigating a loan can be confusing, especially if you haven’t done it before.

Finding a lender that is reliable and willing to answer any questions you have can make a huge difference. You’ll also want to make sure they can process your loan application in a reasonable time frame. You won’t want to be waiting months to receive your money or check the status of your application.

What are the Best Personal Loans for December 2021?

There are so many personal loans to choose from right now, many of which offer very low-interest rates and flexible payment terms. Here are some of LendStart’s top picks for personal loans in December 2021.


While not a direct lender themselves, Credible is an online lending marketplace platform that connects borrowers to lenders in their network. You can use their platform to browse a variety of different loan options from trusted partners and see what loans and rates you qualify for—all in one place.

PenFed Credit Union

PenFed is a direct lender offering loans as small as $500 and is a solid option for those with good credit. They offer low-interest rates and you can manage your loan entirely through your smartphone.


LendingTree is another lending marketplace that makes it easy to compare multiple lenders in one place. Rather than submit multiple applications on various websites, borrowers can submit some basic information on this one platform to get immediate offers from qualifying lenders.

Final Thoughts

If you’ve been thinking about taking out a personal loan, December 2021 is going to be a great time to do so. Rates are at an all-time low.

With a little research and comparison shopping, borrowers can secure super-low personal loan rates to fund those major purchases.


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Written by Jessica Cotzin

Jessica Cotzin is a writer and the Lendstart authority on small businesses and personal loans. She has been writing about personal finance and the loans industry for a number of years, and holds a bachelor’s degree in journalism from Florida Atlantic University.