If you’re wondering: “What are signature loans?” Tio Rico is here to help. We get asked this question a lot, we can explain signature loans and help you get the money you deserve. A personal loan is an unsecured loan provided by borrowers like us, banks, or other finance companies. The loan simply utilizes the borrower’s signature and promise to repay as collateral. Since the collateral is not physical property or of “real” value, the loan rates tend to be a bit more than most types of credit. For this reason, these loans are also referred to as “good faith loans” or “character loans.”
What Can I Use a Signature Loan For?
Taking out an unsecured signature loan is similar to using a credit card, but the amount borrowed is generally applied towards one specific purchase and then paid off with a pre-specified number of equal monthly payments.
This variety of loan can be used for whatever purposes the borrower chooses. We all have situations when we have an emergency or a great need that comes up unexpectedly. This type of loan is helpful when a borrower needs money quickly and has the income to pay back the loan in a timely manner.
What are the Pros and Cons When It Comes to an Unsecured Loan?
Like any credit situation, there are positive and negative attributes. Signature loans can actually have a better interest rate than other fast cash loans, such as payday loans. They can also be a reasonable way to consolidate high variable interest rate credit card debt into one fixed monthly payment resulting in a more attractive rate. Again, be aware of when your payments are due in order to avoid furthering debt.
At Tio Rico, you can find out if you qualify for signature loans within 30 minutes. See our example rates and terms for California and fill out the application online.