What are signature loans?
You may have heard the term signature loan, and asked yourself: what is it?! Does that mean there are no signatures required on the loan contract?
A signature loan is a loan that does not require that you provide a personal asset as collateral in exchange for the loan. A secured loan requires that you place a personal asset up for collateral in exchange for the loan. For instance, an auto title loan requires that you use your car for collateral in order to receive the funds. That way, if you do not repay the loan, the lender has the right to take possession of the car. Signature loans do not require any collateral. Instead, the loan is based on your ability to repay the loan, including a proof of employment and income. Generally, lenders will not run a credit check, which is why they’re ideal cash loans for bad credit.
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