We simulate transverse oscillations in radiatively cooling coronal loops and forward-model their spectroscopic and imaging signatures, paying attention to the influence of background emission. The transverse oscillations are driven at one footpoint by a periodic velocity driver. A standing kink wave is subsequently formed and the loop cross section is deformed due to the Kelvin–Helmholtz instability, resulting in energy dissipation and heating at small scales. Besides the transverse motions, a long-period longitudinal flow is also generated due to the ponderomotive force induced slow wave. We then transform the simulated straight loop to a semi-torus loop and forward-model their spectrometer and imaging emissions, mimicking observations of Hinode/EIS and SDO/AIA. We find that the oscillation amplitudes of the intensity are different at different slit positions, but are roughly the same in different spectral lines or channels. X-t diagrams of both the Doppler velocity and the Doppler width show periodic signals. We also find that the background emission dramatically decreases the Doppler velocity, making the estimated kinetic energy two orders of magnitude smaller than the real value. Our results show that background subtraction can help recover the real oscillation velocity. These results are helpful for further understanding transverse oscillations in coronal loops and their observational signatures. However, they cast doubt on the spectroscopically estimated energy content of transverse waves using the Doppler velocity.