What happens after I applied for a loan?

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When applying for a loan, each bank immediately begins the process of its consideration, as a result of which a decision is made to issue a loan or refusal to provide it. In current conditions, the decision on lending small amounts is accepted rather quickly.

The general principle for analyzing borrower data is the same in all lenders and consists of several successive steps.

  • Visual assessment.When a client comes to the bank and says that he wants to get a loan, the bank manager invites him for an interview. The manager puts several questions, finds out the needs of the applicant, and then begins the process questionnaires. In the process, additional questions may be asked in order to verification of the accuracy of the data provided by the applicant.
  • Request to the credit bureau. After sending an application for a loan, a request is automatically made to the credit bureau. The bank needs to find out the credit score. This request is very fast. Most often, if a negative decision is made, then the reason can be the revealed negative information in the bureau.
  • Assessment of the borrower. Now more and more lenders are using fully automated methods of analysis of applicants’ data, which significantly reduces the processing time of online loan applications. Credit institutions apply for these special scoring programs developed individually by each bank.

By analyzing the client, he is awarded points. For approval or transition applications for the next stage of consideration, the client must have the minimum allowable number of points. The number of points is influenced by age, family position, level of education, place of work, and so on. Also, at this stage, an analysis of the applicant’s creditworthiness is carried out. Based on the expenses and incomes, the system determines whether the citizen will be able to pay the credit.

Suppose the client has not scored the required number of points, renouncement. Each bank has its own level of the minimum number of points, and the dimensions, as well as the principles of data analysis, are never disclosed.

  • Consideration of the application by the security service. This department can have different names. The stage itself is final and not always applied. For simpler and faster programs, there may be enough scoring points. If the program is characterized by good conditions and large amounts, then after gaining points, the application goes to a specialized department. In this case, the term for considering the loan application can last for two days. The department examines the applicant’s documents, analyzes personal data, can carry out inquiries on the subject of debts to judicial bailiffs, and carry out other checks. If the security service has no suspicions about the application of the borrower, the issuance of the loan is finally approved.

After submitting all the necessary documents, time to just wait patiently until you hear back! The lender you have submitted your loan with will get back to you with more details about the new mortgage!

Written by Bader Albader, market researcher.