A signature loan, also known as a good faith loan or character loan, is an unsecured loan that uses only your signature and promise to pay as collateral. A signature loan can be used for any purpose the you choose, although the interest rate may be higher than with secured loans due to the lack of any real collateral.
Because of the added risk to the lender, your credit rating and verification of income will be determining factors in your interest rate. Be very careful about taking on any loan advertised as a signature loan with no credit check. Such a loan is most likely a cash advance, title loan or payday loan with very high fees and interest rates ‒ so buyer beware!
Signature loans are no longer just for borrowers with shaky credit. As interest rates have fallen and our loan maximums have increased, many higher-income borrowers with good credit have turned to these loans when they need some ready cash.
It's likely that LoanMerica can offer you a loan with an interest rate that's lower than what your paying on your credit cards. If that's the case, you spend less on interest and save money in the long run. To find out about a signature loan and other unsecured loan options, give us a call at (800) 391-9310.