Know all About the Personal Loan Application and Disbursement Process

If you are applying for a personal loan, you should familiarise yourself with the loan application process. This will prepare you for the loan application process and its demands, which will result in an easy, hassle-free experience for you. The typical loan application process entails the following process:

Examine the Eligibility Criteria: Each lender has its own eligibility criteria. Lenders of personal loans requisite the loan applicant to be a salaried individual. This results in a cut-off on the salary amount per month. For instance, a lender may have a minimum salary criterion of Rs. 30,000 per month. In the case of self-employed applicants, the profit of their business loan over a specific period is considered. In addition to this income criterion, there are benchmarks imposed on credit score, age, employment history, etc.

• Compare Different Lenders: There are numerous lenders on the market. They each have their own eligibility criteria. Compare the loan details of those lenders that you qualify for. Consider the following information: interest rate offered, type of interest rate – fixed or flexible, loan tenure, maximum loan amount, repayment schedule, etc. Select the lender that suits you well.
• Plan Your Repayment Schedule: Before applying for a personal loan, you should plan ahead and study the repayment schedule each lender offers. This will help you select that lender that can provide you with the loan amount with repayment conditions and time that you can follow. This is particularly important because if you choose a lender with a repayment schedule, you can’t comply. It may lead to you failing to pay on time and even default. This will ultimately harm your credit score, which must be kept high if you plan to take out loans.
• Keep Your Documents Handy: Personal loans don’t demand many documents for the application process. There are some primary documents that you must submit. Such documents typically are recent photographs, identity proof, residence proof, salary slips or bank statements, etc. Preparing the necessary documents beforehand can save time and enable you to avail of the loan amount you urgently require.
• Loan Application: This is the step where you submit the documents mentioned above to officially start the personal loan process. This can be either done physically or online. If you require any clarifications, you can seek your lender’s assistance.
• Wait for Approval: After submitting the loan application form and the required documents to your lender. You then have to wait for the lender to approve your loan application.

Loan Approval

Once your loan petition is received, you will receive an acknowledgment from the lender. This approval process initiates as soon as the lenders verify the submitted documents. It will conduct a thorough background examination of your credit to decide whether to accept your application or not. The length of the whole loan approval process varies. If you have furnished the proper documentation to your lender, the process can be resolved within minutes. Various lenders offer instant personal loans, with some claiming approval and disbursal within minutes of application reception.

Loan Disbursal

If the lender approves your loan application, you will be informed of this, and they will start with the loan disbursal process. You will be given a document containing all the vital details of the loan. Make sure to peruse and know all the fine details in this document. If there is any confusion, contact the lender and clear it up. Once you are satisfied with the loan details, sign the loan document. The lender will deposit the sanctioned loan amount to your bank account. This usually happens within 24 hours of signing the document.

Conclusion:

Personal loans are easy to avail of if you satisfy the lender’s eligibility criteria. You can follow the loan application steps described above to ensure a quick disbursal of your loan. Also, understand and sign the loan documents only when familiar with the loan details. Instead of blindly sticking to a lender that enters your sight first, compare different lenders and their offerings to find the best personal loan for you.