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Personal Loans

Christmas Loans: How & Where to Borrow Money for Christmas

Updated Jun 28, 2023   |   7-min read

The Christmas season can be an expensive time of year. Almost everyone who celebrates will be faced with expenses ranging from presents to holiday meals to traveling to see friends and family. 

With so much to spend on, it’s no surprise that our annual survey found the expected cost of Christmas in 2018 was more than $600. If you can’t afford to pay these expenses out-of-pocket, you may find yourself looking for Christmas loans to get through the season. 

Lots of lenders offer Christmas loans, but some are better than others. This guide can help you find the best Christmas loans from our partners and determine what kind of financing is right for you.  

In this guide:

Christmas loans

When it comes to Christmas loans, some lenders offer fair financing, while others have more predatory motives. Personal loans tend to be the best option since they offer fair rates and can be used for just about anything.

The right lender for you will depend on your current credit situation. Check out the lenders below and make sure you meet their eligibility requirements before applying.


  • Rates (APR): 8.49% – 35.99%
  • Loan Amounts: $1,000 – $50,000
  • Credit Score: 580+

Upgrade’s eligibility requirements are based more on free cash flow as compared to other lenders. They are a great loan option during Christmas for borrowers seeking smaller loan amounts and have bad or fair credit.

  • Credit score category: Fair, bad
  • Soft credit pull to check rates: Yes
  • Deposit time: As soon as the next day
  • Origination fee: 2.9% – 8%
  • Late fee: $10
  • Repayment terms: 36 or 60 months


  • Rates (APR): 6.12% – 35.99%
  • Loan Amounts: $1,000 – $50,000
  • Credit Score: 580+

Upstart is another solid option for borrowers with fair or bad credit. The company leverages AI and machine learning to automate the borrowing process. This direct-to-consumer lending platform provides a low minimum loan amount, and borrowers may receive their funds as soon as one business day3.

  • Credit score category: Fair, bad
  • Soft credit pull to check rates: Yes
  • Deposit time: As fast as one business day3
  • Origination fee: 0% – 10%
  • Late fee: $5 or 15% of payment (whichever is higher)
  • Repayment terms: 36 months or 60 months1

What is a Christmas loan?

Christmas loans are simply personal loans, although some lenders market them specifically as holiday loans for the season. You can use the funds from a personal loan for virtually any purpose you’d like.

A wide variety of lenders offer personal loans, including local banks, online lenders, and credit unions. They can be a great option for borrowers because of relatively low interest rates, wide availability, no collateral requirement, and flexible credit requirements. 

Is taking out a Christmas loan a good idea?

In general, you should avoid going into debt for non-essential expenses. Still, you may not be able to avoid some Christmas season spending. If you have to take out a loan, a personal loan could be better than more costly alternatives, such as payday loans and credit cards.

When you must borrow for Christmas, look for reputable lenders. Payday loan lenders often market “personal loans” with no credit check, but these loans are extremely expensive and should be a last resort. 

3 tips for borrowing money for Christmas

These tips will help you borrow responsibly if you need to take out a Christmas loan.

1. Set a Christmas budget (as early as possible)

Budgeting for Christmas can help you control your expenses. Ideally, you’ll start saving early and be able to cover the costs with cash and, if you expect one, a Christmas bonus.

If you do borrow, plan to repay your debt within around four to six months of the holiday at most. If your planned expenses take a full year to pay off, you’ll likely be in the same situation next year. And if you have to borrow again, you’ll constantly find yourself paying off Christmas debt. 

2. Decide which traditions to keep and which to let go

While you may be tempted to keep every tradition alive forever, you should carefully think about your Christmas expenses and see whether you can do without any of them. 

Perhaps you could switch to a gift swap with one family member instead of buying for everyone, or opt to stay in and rent a movie rather than taking everyone to the theatre to see the year’s big release. Lower costs will mean less debt. 

3. Avoid Christmas financing traps

Some forms of Christmas financing are dangerous to your finances and more expensive than they’re worth. If you plan to take on debt for the holiday, avoid payday loans, car title loans, and store credit cards.

Payday Christmas loans

Payday loans, or cash advances, are short-term loans that come with fees and interest rates around 400% or higher. These loans can quickly trap you in debt, because they are so expensive that borrowers are often forced to repeatedly borrow. 

What to choose instead: Look for a personal loan from a bank, credit union, or online lender with flexible credit requirements and quick funding. Rates vary based on your credit history, but people with good or fair credit should look for interest rates around 5% to 15%. 

Car title loans

Auto title loans are a form of payday loan that uses your vehicle as collateral. Even though they’re secured, they can come with high interest and fees—and you put the ownership of your car on the line.

What to choose instead: If you need a secured loan, a home equity loan or home equity line of credit may offer you better terms. To keep your important assets safe and keep your borrowing low, though, an unsecured personal loan is your best option.

Store credit cards

Stores often try to get you to sign up for branded credit cards during the Christmas shopping season. You may even get a discount if you sign up. Unfortunately, these often come with high interest rates, poor rewards, and limited spending options outside the store. 

What to choose instead: If you need to use a credit card, look for one offering a 0% promotional APR. If you can pay off the balance before the promotional period ends, you’ll finance your Christmas spending for free. And you might even be able to earn credit card rewards or a sign-up bonus while doing it.

Recap of Christmas Loans

LenderRates (APR)Loan Amounts
Upstart8.69% – 35.99%1$1,000$50,0003

1 The full range of available rates varies by state. The average 3-year loan offered across all lenders using the Upstart platform will have an APR of 21.97% and 36 monthly payments of $35 per $1,000 borrowed. For example, the total cost of a $10,000 loan would be $12,646 including a $626 origination fee. APR is calculated based on 3-year rates offered in the last 1 month. There is no down payment and no prepayment penalty. Your APR will be determined based on your credit, income, and certain other information provided in your loan application.

2 Your loan amount will be determined based on your credit, income, and certain other information provided in your loan application. Not all applicants will qualify for the full amount. Loans are not available in West Virginia or Iowa. The minimum loan amount in MA is $7,000. The minimum loan amount in Ohio is $6,000. The minimum loan amount in NM is $5100. The minimum loan amount in GA is $3,100.

3 If you accept your loan by 5pm EST (not including weekends or holidays), you will receive your funds the next business day. Loans used to fund education related expenses are subject to a 3 business day wait period between loan acceptance and funding in accordance with federal law.