A personal loan gives you a handy credit line to fund various expenses - from medical to travel. While several online guides help you determine the application process, most leave out the part about 'how to know if your request has been approved?'
It's pretty simple. You get a personal loan approval letter from your lender. This letter states that the lender has cleared your loan application under specific terms and conditions. Also known as the loan sanction letter, it is one of the essential documents in the loan approval process.
A personal loan approval letter is a lender-issued document that qualifies as proof of approval. This signals that the lender has green-lighted your loan request. The components of a personal loan approval letter clearly outline the terms and conditions for its approval.
While personal loan sanction letter formats can vary from one lender to the next, most contain the following particulars:
Note: Most personal loan sanction letters are valid for up to 6 months. If this validity window expires, you will have to start the application process from scratch. Moreover, this letter is not equivalent to a disbursal letter the lender sends once the loan agreement is signed.
Yes. While not your disbursement letter, your personal loan approval letter is just as important. Here's a list of reasons why you should assess, sign, and preserve this letter:
To improve your chances of getting an approval letter, you can lower your debt-to-income ratio and clear outstanding debts to improve your CIBIL score. Having a stable source of income and the right documents in place expedites the verification process, improving your approval chances.
However, waiting for your personal loan approval can take a while. If you need immediate funds and have a good CIBIL score, you can rely on Fi Money's pre-approved instant loans borrowing a maximum of Rs. 5 Lakhs at pocket-friendly rates.
A personal loan sanction letter qualifies as an official loan approval document issued by the lender after verifying the loan request. It outlines all the terms and conditions of the loan, including loan amount, ROI, EMI amount, tenure, fees, etc.
To get a personal loan sanctioned, you must meet the lender's eligibility criteria and submit the necessary supporting documents. The lender will then review the application, check your credit history, and assess the documents to sanction the loan if the application meets its requirements.
Yes. If you're unhappy with the loan terms, you can reject the loan even after receiving the sanction letter.
You can only receive a loan sanction letter from your lender. If you've applied for a personal loan, you can expect one from the lender once the verification is completed.