Personal Loans are one of the most sought-after financial options in India. Whether it’s a dream wedding, international travel, higher studies, house renovation, or medical emergency, Personal Loans are an all-in-one solution for all your financial requirements.
The popularity of these loans is fuelled by the fact that they are unsecured loans. This means that the borrower is not required to provide any collateral to secure a loan.
Since there are no securities in case of loan default, lenders usually remain extra careful during the Personal Loan verification process. This blog will help you understand the complete verification process of a Personal Loan.
What is the Personal Loan Verification Process?
Lenders follow a simple verification process when approving a Personal Loan. In this process, financial institutions verify if the details provided are valid or not. You must meet the lender’s eligibility criteria to get your loan application approved. Your documents, income, credit history, and CIBIL score are some of the crucial fac/tors that lenders check if you meet their eligibility criteria.
4-Step Verification Process for a Personal Loan
The verification process for getting a Personal Loan is simple. Just go through the steps below:
Step 1: Loan Application
This is the first step of the Personal Loan verification process where you will need to fill up your Personal Loan application. You can do it online or offline by reaching the lender’s branch. After submitting the Personal Loan application, you will get an application number. Use the number to check the status of your application.
Step 2: Collection of Documents
As the lender receives your loan application, the process of document collection starts. To do this, lenders mostly send their representatives to collect your documents. They can even ask you to visit the branch and submit it. For a smooth and quick loan verification process, you must submit your valid documents. The required documents for a Personal Loan may vary from one lender to another.
The following documents are generally required by most lenders
- KYC Documents
- Address Proof Documents
- Income Proof Documents
- Financial Documents
- Employment Proof Documents
Please note that the above-mentioned document list is indicative. Lenders may require additional documents during Personal Loan processing time.
Step 3: Verification of Documents
Once all the necessary documents are received, the lending institution begins the verification process by forwarding the documents to the documents verification department. Most lenders generally have a separate team of professionals for conducting verifications on their own. A representative from the team is sent to the borrower’s residence to verify his/her address in person.
They also visit the borrower’s workplace to verify if the individual works there. Do note that the verification team can also enquire about your salary and the number of years/months of your service in that company. Verification of other documents, such as an Aadhaar Card, PAN card, or passport is done online using their respective portals.
The verification team consolidates all the findings of the verification process and forwards them to the loan officer who handles that Personal Loan account. If the lender is satisfied with the verification process findings, then the loan will be processed further.
Step 4: Loan Disbursal
This is the last step of the Personal Loan verification process. As soon as the loan officer receives a positive report from the verification team, the final loan agreement is drafted. At this stage, the loan repayment tenure, rate of interest, EMI amount, additional fees & charges are mutually agreed upon by the lending institution and the borrower.
Before signing on the dotted line, you should carefully read the fine print. After signing the agreement, the lender will transfer the Personal Loan amount directly to the applicant’s bank account.
Also Read: Instant Personal Loan Application Process: Step-by-Step Guide for Hassle-Free Loans
How to Apply for a Personal Loan Online?
The process of applying for a Personal Loan is extremely simple. All you need to do is follow the steps below:
Step 1: Find the ‘Apply Now’ button on your screen’s top right corner and click that button.
Step 2: Fill your personal information like name, name and type of your business, phone number, PAN number, etc.
Step 3: Upload documents that are required with your application and submit.
Also Read: Tracking your Personal Loan Application Status
To Conclude
Usually, financial institutions follow a simple Personal Loan verification process, to process your credit request faster. So, make sure that your documents and details are accurate, and that your loan application form is error-free. On having all the necessary details, apply for a Personal Loan of up to Rs. 30 Lakh from Poonawalla Fincorp to fulfil your financial needs.
Frequently Asked Questions
- At which stage the details of the loan applicant is verified?
Once you submit all the required documents, the lender will verify your personal information, income levels, job status, and credit score to check your creditworthiness and repayment ability.
- How to check the status of my Personal Loan verification process?
You can check the status of your Personal Loan verification process by calling the lender’s Personal Loan customer care department.
- What is the Personal Loan approval time?
Personal Loan approval time can take anywhere between a few days to a few weeks and is usually dependent on the type of lending institution you choose and their lending policy.
- Can I reapply for a Personal Loan if my loan application is rejected?
Yes, you can reapply for a Personal Loan but only after you ensure that this time you fulfil all the eligibility criteria set by the lender. Also, take necessary actions to improve your credit score and credit history. Otherwise, the lender may reject your loan application again.
- When is the loan amount disbursed after the loan approval?
The lender will transfer the approved loan amount directly to your bank account within 24 hours of signing the loan agreement.