How Long Does It Take To Get a Personal Loan? What To Expect

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Most personal loans take 1 to 7 business days for full approval and disbursement, although some lenders offer same-day funding. Timelines largely depend on the type of financial institution.

For instance, online lenders usually have faster turnaround times than traditional banks or credit unions. 

Other factors that can affect the timeline include:

• Prequalification, which may take a few days
• Underwriting requirements
• The loan type and amount
• The borrower’s overall credit profile

Learn more about how long it takes to get a personal loan, including ways to speed up the process.

Personal Loan Process Explained: From Application to Receiving Funds

Stage 1: Application (5 to 10 Minutes)

Thanks to modern technology, you can start most personal loan applications online and complete one in minutes.

You’ll visit the lender’s website and how much you’d like to borrow and what you’ll be using it for. You’ll also plug in the required personal and financial information, including:

• Name
• Physical address
• Email address
• Date of birth
• Social Security number
• Housing and work status
• Income, expense and asset estimates

Note: If you fill out a paper loan application in person, the process may take longer.

Stage 2: Prequalification (Instant to a Few Hours)

Some lenders offer prequalification, which uses basic personal information and a soft credit check to provide conditional approval and rate estimates. Given that soft credit checks don’t hurt your credit, prequalification allows you to compare offers and find the best available terms. 

It can also expedite the application process, as the lender gets a head start on verifying your information.

Prequalification, sometimes referred to as preapproval, is almost always instant, though it doesn’t guarantee full approval. You’ll still need to complete the lender’s underwriting process.

Stage 3: Underwriting and Verification (1 to 3 Business Days)

Lenders will verify your application information and thoroughly assess your creditworthiness — i.e., your ability or likelihood to pay the loan as agreed. They’ll conduct a hard credit check and contact your employer to verify income. 

“Some lenders will require a certain number of years of credit history,” said Kyle Enright, president of lending at Achieve. “At my company, for example, we require at least two years.”

At this stage, lenders will ask for:

• State-issued identification, like a driver’s license or passport
• A photocopy of your Social Security card
• Recent pay stubs, W-2s and tax returns
• Employment and income verification authorization form
• Bank account statements
• Account number and routing number for loan disbursement 

The underwriting and verification process typically takes a few business days, but can be delayed if you don’t submit documents promptly or if the lender requires additional information.

Stage 4: Final Approval (Same-Day to 3 Days)

Once underwriting is complete, the lender will send a notice of approval or denial.

You’ll receive an official loan agreement outlining the terms and conditions of the loan if you’re approved. You’ll review and sign this letter to secure final loan approval.

You can complete this step on the same day you receive the loan agreement, though there could potentially be delays if you or the lender aren’t able to reach each other.

Stage 5: Funding (Same Day to 5 Business Days)

Once you secure final approval, the lender will disburse the funds. Timing depends on the financial institution and how you prefer to receive the money.

Online lenders typically transmit funds within one to two business days. Traditional financial institutions can take longer, especially over weekends and holidays when there are no Automated Clearing House (ACH) transfers.

Lenders can deposit the money directly into your bank account. Some offer alternative disbursement options, such as a cashier’s check. Direct deposits usually occur on the same day. Alternative options can take longer, usually five to seven business days.

What Can Delay Loan Approval or Funding? 

All parties can cause a snag in the process. Here are the most common reasons for delayed loan approval and funding.

Applicantion Issues

• Incomplete application or documentation can lead to a time-consuming back-and-forth with lenders.
• Low-to-no credit can give lenders pause and merit a longer underwriting evaluation.
• High debt-to-income ratio may require additional documentation, such as additional proof of income or a letter explaining that your income is stable.
• Too many recent credit inquiries may lead to additional lender questions about why you’ve been loan-shopping and whether you plan to take on other financing.

Lender-Related Issues

• A high volume of personal loan requests can lead to a backlog and push back approval times.
• Staffing shortages can cause a similar logjam.
• Stringent underwriting or paperwork requirements take longer to process.
• Submission times can affect timelines, especially if you submit an item after working hours or on weekends, when the lender is unavailable. 

Factors Outside of Your Control

• Hard-to-reach employers can delay the verification and underwriting process.
• Public holidays or weekends can cause snags at any point, including funds disbursement, as ACH transfers are unavailable on those days.
• Bank transfer delays can lengthen the disbursement process.

How Different Lenders Compare on Timelines 

Not all lenders work on the same timeline. However, you can expect certain commonalities among lender types.

Lender Type and Typical Timelines

Lender Examples 

• Online lenders: SoFi completes most personal loan applications in two days, while Lightstream advertises same-day approval for qualified applicants. 
• Credit unions: Alliant Credit Union can provide same-day funding to qualified online applicants. Navy Federal Credit Union can offer same-day financing once a loan is fully approved, although the complete process takes longer. Keep in mind that only credit union members can apply.
• Banks: While banks are known for longer processing times, some can fully approve and fund personal loans more swiftly for checking or savings account members. Citi®, for instance, offers same-day funds to approved loan applicants when you opt for direct deposit into an existing Citi checking account. Check out the top banks for personal loans. 
• Apps: Using an app like Brigit, Earnin or MoneyLion can offer some benefits if you’re a qualifying borrower. For example, MoneyLion is an online lending marketplace and cash advance app that offers instant paycheck advances of up to $500 for a fee and personal loans from partner lenders within a few hours to a few days.

Tips to Get a Personal Loan Faster

The following strategies can streamline and expedite the personal loan approval process.

Check Your Credit Report

Uncaught errors or surprise missteps can lead to an unexpected loan denial. Check your standing by requesting a free credit report from AnnualCreditReport.com. Dispute any errors with the credit bureaus.

Get Prequalified

Lenders with prequalification technology are known for fast turnaround times. Plus, this step helps you compare offers and find affordable terms.

Apply Online  

Expedite the process by applying with reputable lenders with a track record of fast financing. You can get a sense of which one is a good fit by reading reviews on third-party platforms like Trustpilot and the Better Business Bureau (BBB). 

Respond Immediately to the Lender’s Requests 

The lender can only move as quickly as you do, so keep an eye on your phone or email and respond to any correspondence promptly. 

Gather Documentation Ahead of Time

“Find out from the lender what their exact requirements are, and gather all your documents and other information,” Enright said. “That way, you’ll be prepared to complete and submit the application expediently.”

Choose Direct Deposit

A lender needs to print and mail alternative disbursements, such as cashier’s checks, which lengthens the turnaround time by five to seven business days. Direct deposits often occur on the same day as your final loan approval.

What To Do if You Need Money Immediately

If you need fast funding, consider the following:

• Find a lender who advertises same-day approval and fast funding — within 24 hours to three days. These turnaround times are more common among online lenders and fintech marketplaces. 
• Consider other credit options, like credit cards. Credit cards come with a 28-to-55-day window in which you can repay without incurring interest. Be sure to avoid payday loans, however, which charge high fees and have incredibly short terms. 
• Ask a friend or relative for a loan. “Be aware that an unpaid loan can sometimes strain or damage relationships,” Enright said. “Put any agreement in writing, including interest you will pay.”
• Try emergency cash advance apps. These borrowing apps offer small-dollar, short-term loans that help you bridge gaps between paychecks. Check for fees, limits and subscription requirements. 
• Consider getting assistance, such as a debt relief program. “Many people who need cash quickly are in a situation where their bills are more than they can pay on a regular basis,” Enright said. “If so, talk with a reputable, credible debt relief firm about alternatives.” 

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