How Does Personal Loan Verification Process Work? - Loan Trivia


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Monday 23 May 2022

How Does Personal Loan Verification Process Work?


As the costs increase for literally everything, so does the demand for personal loans. As days went by, more and more people were applying for personal loans. Now it is putting pressure on the lenders to approve the loans. The personal loan verification process is becoming a very crucial stage for both lenders and borrowers. 

Most lenders require proof of address, identity, and income to approve a personal loan, as it is related to monetary transactions. The authenticity of the documents must be checked.

How does the process work?

The process is described below from the lender’s perspective.

Receive application- The first stage of the personal loan verification process. The lender required a loan application to verify the documents collected. Then the lender can further process the loan application. The borrowers have two choices to select from. They can either visit the bank or apply online.

Documents collection- When the lenders receive personal loan applications, whether it is online or offline, they send representatives. The lender's representatives are sent to meet the potential borrowers to collect the physical documents required to process the personal loan. Most lenders ask for address proof, identity proof, income proof, and a duly filled form with a passport-sized photograph. This is the time when you can also discuss flexible tenor and easy EMI payments.

Documents verification process- The lenders take minimum time to analyze the documents provided by the potential borrower. This is the work of the verification department. Then a verification agent is sent to the borrower’s residence and workplace to verify if the provided addresses are right or wrong. Verifications of documents such as Aadhaar, PAN, and passport is done using various online portals. Then the further work is transferred to the personal loan officer. After a successful verification process, the lenders sanction the loan amount. It may also get canceled in this stage if the lenders suspect any mismatch in the provided documentation.

Loan sanction- This is the last stage. Here the lenders sanction the loans. They also describe all necessary information to the borrower, such as loan amount, period, interest rates, fees, charges, and all the terms and conditions.

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