Key points you need to know about Personal Loans
How long does it take to process a personal loan?
There are standard procedures in processing Personal loans, here are the processes that banks or other financial institution perform:
This is the process where customers submit their documentary requirements to the bank. Documents are then examined to support the identity of the borrower. Once the banks have completed the process, they will proceed with the investigation.
This is where the bank validates the documents that the customer submits. This involves residence verification, which can either be thru a call or actual visitation conducted by credit investigators. It also involves employment verification, which is usually done thru a call to the place of work verifying the actual employment either to the human resources division or the immediate superior. Evaluation of a person’s creditworthiness, which is via a person’s credit score, is the last step to verify if the person can pay off the mortgage and for credit evaluator to continue with the process of personal loan.
This is where documents and findings are gathered together to come up to a report as to the credit worthiness of the customer. Base on the overall report made, the application is either approved or declined. Either way, the customer will be notified of the result of their findings.
These steps usually take around 5 to 15 working days, depending on each bank’s procedure on the processing of the application. Meanwhile, there are banks even that make credit decisions as fast as 24 hours, but results still depend on how fast is the response from your end will be with regards to information verification.
What are the payment terms in a personal loan?
Some of the most common loan payment terms in the Philippines are the following:
- 6 months
- 12 months
- 18 months
- 24 months
- 36 months
- 48 months
While these are the most common terms of payment available for personal loans, you can consult the banks if they offer other terms that will definitely suit you best.
What are the modes of payment for personal loans?
Modes of payments for a personal loan can either be the following:
- Thru issuance of postdated checks
- Can be thru over the counter cash/check payment at the banks accredited by the creditor bank.
- Via debit to the account of the customer (at an account maintained at the creditor bank)
What loan purposes are acceptable for personal loans?
As part of their investigation, banks will ask your purpose on why you apply for a personal loan. Some of the acceptable purposes for getting personal loans are the following:
- Tuition fee/school expenses
- Credit card payment
- Medical expenses
- Car accessories/repairs
- Minor home improvement/renovation
- Appliances/electric gadgets
- Special events (weddings, debut, anniversary, etc.)
How can I claim my loan once it has been approved?
You may claim your loan proceeds using the following methods:
- Managers check issued by the creditor bank
- ATM issued by the creditor bank
- Direct deposit to your account
- Delivery of check proceeds to your doorstep
How will I be notified if my application is approved or declined? Regardless of the result of the investigation, banks will notify you of their decision. You will be notified via telephone call, text message, or mail whether application is approved or declined. If your loan is approved, you will either receive a letter stating the payment due date, installment amount, tenure, loan amount approved and will be asked to ready your postdated check (if PDC is the mode of payment required).