Understand The Process Of The Personal Loan Disbursement

By Author: Arjit Chalmela
Total Articles: 14
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You should try to understand as much about the loan disbursement process as possible if you plan to take out a personal loan, primarily to finance a financial emergency. This will help you receive the loan in time to handle the crisis.
So, what is the disbursement process of the Personal Loan? How much time would it take to pay out your loan to the lender? Let us go through the entire process of application and disbursement to better understand personal loans.

The loan application is the first stage of the loan disbursement process. You will then be allowed to apply for a personal loan once you have chosen a lender. You can apply for personal loan online or by visiting the lender/ bank. In addition to a properly completed application form for loans, you will have to submit documents such as:
ID proof
Address proof
Income proof
Bank statements
Income Tax Returns (ITR)
Two passport size photographs 

The lender will then begin the approval procedure once you have submitted ...
... the loan application along with the necessary documentation. Approval will take 2-3 working days, depending on the lender you pick. If your records are not in order, approval will take longer. 

So, before submitting your loan application, make sure that you thoroughly review the documentation needed for the loan. Loan approval usually is easier if you are the lender's current client. For example, you can choose the same bank for your personal loan in which you have your savings or salary account.
 

If your loan is accepted, either by e-mail or by post, the lender will then give you a sanction letter. The sanction letter states that, along with other information such as interest rate, loan number, Equated Monthly Instalment (EMI), etc., your loan application has been accepted. 

After approval, personal loan disbursement time can vary from 1-2 working days. By visiting the lender, you will then obtain the cheque for the loan sum. The check is also mailed to your address by specific lenders. Many lenders have started depositing the loan sum directly into the borrower's bank account in the last couple of years. 

The lender will then give you a confirmation letter for the same one once the loan gets disbursed. This gets sent by e-mail or by post. The confirmation letter usually comes with a welcome package along with it. 

Details about your Personal Loan, EMI, amortisation table, EMI payment options, due date, customer service and more are included in the welcome package.