Finding the Best Signature Loans Near You

Looking for a signature loan near you? A signature loan can be a great financing option when you need funds for a major purchase, home improvement project, medical procedure, or to consolidate debt. But not all signature loans are created equal. It’s important to shop around and find the lender that offers the best loan terms and rates for your situation.

In this article, we’ll explain what signature loans are, their pros and cons, and provide tips on how to find the best signature loans in your local area Whether you decide to go with an online lender, bank, or credit union, you’ll be armed with the knowledge to compare your options and make the right borrowing decision

What is a Signature Loan?

A signature loan also known as an unsecured personal loan is a fixed-rate loan that does not require collateral. Instead, you provide a promise to repay the loan, typically by signing an agreement. The lender approves you based on factors like your credit score, income, and debt-to-income ratio rather than collateral.

Signature loans allow you to borrow a lump sum of money upfront, which you repay in fixed monthly installments over a set repayment term, usually between 1-5 years. The interest rate and fees are fixed for the life of the loan, so your monthly payment does not change.

Signature loans can be used for almost any purpose such as:

• Consolidating high-interest credit card balances
• Funding home improvements or remodeling projects
• Paying medical bills
• Covering emergency expenses
• Financing a vacation
• Paying tuition
• Purchasing an engagement ring

A signature loan provides flexible funding without putting up an asset as collateral. But because they are unsecured, interest rates may be higher than a secured loan like a home equity loan. We recommend only borrowing what you can comfortably repay according to your budget.

The Pros and Cons of Signature Loans

Signature loans offer both advantages and downsides to consider:

Pros

• Available from online lenders, banks, and credit unions
• Fixed interest rates and monthly payments
• Predictable repayment term of 1-5 years typically
• Funds accessible in a lump sum
• Quick online application and funding
• No collateral required
• Can be used for almost any purpose

Cons

• Higher interest rates than secured loans
• Requires good credit score for approval
• Unsecured – nothing backs the loan in case of nonpayment
• Limited loan amounts of $1,000 – $35,000 usually
• Early repayment penalties may apply

While signature loans are a helpful financing option for many borrowers, make sure you compare interest rates and terms across multiple lenders. We also recommend first exploring lower-interest debt consolidation options like a balance transfer credit card before taking out a personal loan.

Tips for Finding the Best Signature Loans Near You

Here are our top tips for locating the best signature loan offers in your area:

Check online lenders first – Online lenders like LendingClub, Lightstream, and SoFi tend to offer the most competitive interest rates and fees, often beating local banks. Their online applications are quick and funding is fast. This makes them a good first place to check rates.

Compare community banks and local credit unions – After checking rates from online lenders, look to neighborhood banks and credit unions. As member-owned non-profits, credit unions in particular may offer lower interest rates and more flexibility than big banks.

Ask about relationship discounts – Some banks will shave 0.25% to 1% off their advertised rates if you have other accounts there, like checking, savings, or retirement accounts. This relationship pricing can make their loans more competitive.

Compare loan terms in addition to rates – Along with the APR, compare loan amounts, repayment terms, fees, penalties, and other fine print before deciding where to apply. Make sure the loan fits your budget and timeline needs.

Check eligibility requirements – Each lender has their own eligibility criteria based on credit scores, income, and other factors. Pre-qualifying online lets you see which lenders you’re most likely to be approved by before formally applying.

Consider credit union membership – If you’re not already a member, see if joining a local credit union just to access their lending rates and terms may be worthwhile. The membership fee is usually low.

Improve your credit first if needed – Borrowers with credit scores under 670 will have difficulty qualifying or pay much higher interest on a signature loan. Boost your score first before applying if possible.

Use pre-approval offers wisely – Lender pre-approval offers will show you an estimated rate you may qualify for. But don’t apply unless you plan to accept the loan, as too many applications can dent your credit.

Finding and comparing signature loans from multiple sources can take time but yields the best rate for your situation. In the end, make sure the loan aligns with your financial goals and that you can manage the monthly payments comfortably.

How Much Can You Borrow with a Signature Loan?

Signature loan amounts typically range from $1,000 up to $35,000. But the amount you can qualify to borrow depends on several factors:

Your credit score – Borrowers with excellent credit (scores above 740) will have access to larger loan amounts at lower interest rates. Those with poor credit will have lower borrowing limits and pay more interest.

Your income – Most lenders require a minimum income level to qualify for their different loan tiers. Higher earners can usually borrow more.

Your existing debts – Lenders will review your credit report and debt-to-income ratio. The higher your current debts compared to income, the lower your approved loan amount may be.

Loan purpose – If you share what the loan is for, some lenders may cap loan amounts for certain usage types they view as riskier. For example, high loan requests for consolidating credit card debt.

Lender caps – Each lender establishes their own minimum and maximum lending limits. So loan amounts can vary between lenders.

When you apply for a signature loan, be realistic. Only borrow what you reasonably need for your intended purpose. A loan amount that overstretches your budget is a recipe for getting trapped in debt.

What Credit Score is Needed for a Signature Loan?

Signature loan lenders generally require good to excellent credit for approval. Here are the typical credit score ranges needed:

• Excellent Credit (720+ score) – Has the best chance of approval and qualifies for the lowest interest rates. This allows borrowing larger amounts.

• Good Credit (680-719 score) – Has a decent shot at approval but will pay slightly higher rates than those with excellent credit. Loan amounts may be lower.

• Fair Credit (640-679 score) – Usually can still qualify but with higher interest rates or stricter loan limits. Loan approval is not guaranteed.

• Poor Credit (639 or below) – Will have a hard time being approved for a signature loan. Those with poor credit should work on improving their score first before applying.

Keep in mind these credit ranges can vary slightly between lenders. Having significant income can sometimes offset a lower credit score during the approval process. But in general, you need a score of 640 or higher to potentially qualify and receive decent loan terms.

Before applying, get a free copy of your credit report so you know exactly where your credit stands. If your score needs work, take steps to boost it to expand your financing options.

Pre-Qualifying Can Help Find Your Best Loan Options

Pre-qualifying with multiple lenders is a smart way to identify which ones are likely to approve you before formally applying. Pre-qualification uses a soft credit check that doesn’t hurt your score.

Here’s how pre-qualifying can help find your top signature loan choices:

• Gives you an estimated rate and loan amount you may qualify for based on your credit profile and income. This allows you to compare options.

• Shows you which lenders are most likely to approve your application so you can focus there.

• Saves your credit – only pre-qualified applications do a soft credit check that isn’t visible to others. The hard check comes when you formally apply.

• It’s quick and easy – most lenders let you pre-qualify online in just a few minutes with some basic personal information.

• Provides peace of mind – you’ll go into the application knowing approval odds are in your favor.

Be sure to only formally apply with the lender you intent do take a loan with, and only apply for one loan at a time. Too many hard credit checks from multiple applications can temporarily drop your score.

Pre-qualifying and shopping rates is a valuable way to find your best signature loan match with greater confidence.

Which Lenders Offer the Best Signature Loans?

Finding the best signature loan comes down to comparing both rates and repayment terms across multiple lenders. Here are some top places to consider both online and locally:

Online Lenders

• LendingClub – Offers fixed rates as low as 6.95% APR with amounts from $1,000 to $40,000 and terms up