If you are interested in obtaining a signature loan to consolidate existing debt, you can go to a local bank, your credit union, or a finance company. If you belong to a credit union, you may be able to qualify for a lower rate loan with good terms because of your membership. Credit unions may be more lenient when evaluating a consumer's credit because there is a better member-banker relation. Another good source for signature loans are local banks. Your success in obtaining a loan with good rates may be dependent, in part, on your relationship with the bank but banks usually offer relatively low interest rates on signature loans. Typically, banks and credit unions offer interest rates that vary from 10% to 15% (depending on the rate at which they can borrow money to lend to consumers.)

If you have not had success in obtaining a loan from a traditional bank or credit union, you may be able to qualify for a loan through a finance company. Be very careful when considering a loan from a finance company. Individuals who have excessive debt or questionable credit find more success in acquiring signature loans through finance companies, but the loans often come with a big price tag. Signature loans are risky because they are unsecured and when combined with questionable credit worthiness, they become even more risky to lenders. Due to the increased risk, finance company interest rates can be very high (sometimes more than 25%). Higher interest means higher payments that may contribute to mismanagement of finances and over-extension of consumer credit. Finance company loans may be regarded as indicators that the consumer has exhausted conventional options and is desperate for credit. Finance company debt weighs against credit scoring models because; it may be reflective of a consumer who is dependent on high interest credit to continue adverse spending behavior.