A loan is based on a consumer's income, debt and credit history. This is the definition of a personal loan, but just because someone has a bad credit history does not mean they cannot have a personal loan. Personal loans can be used for a number of different reasons, a personal can be used to buy a new car or go on a holiday or buy a present. In most cases paying back a personal loan can last from about two to five years, and the rates at which the money is paid back will be a fixed interest rate. The amount of interest paid back is dependent on the amount of money taken out for the personal loan. Most typical APRs are around 6%, some being in the 5% range and some being in the 7% area. A personal loan can be a serious problem if the APR rate is too high and the payment cannot be paid back each month. In some cases people have got into serious debt not just over personal loans but of any loans because they cannot afford to pay it back.