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    Timeline Of Loan Applications - Banks Vs. Online Lenders

    Whenever you face an unexpected financial need, it is important to have the right knowledge of funding sources and loans with the best APR rates and terms available. With urgent financial requirements, you do not have time to waste.

    Banks and online lenders are two major sources of financing that can help you borrow quickly. However, depending on your creditworthiness and the type of lender, turnaround times for approval can vary.

    Average General Time

    Every lender has its own underwriting process, and the approval time depends on how quickly these steps are executed. The general steps include:

    • Completing the application form
    • Getting preapproved
    • Processing
    • Receiving approval
    • Pre-closing
    • Closing

    General approval time

    • Online lenders require three to seven days
    • Banks can approve the same day or take several days, depending on the circumstances

    The Time It Takes To Apply

    With online lenders, it will be a matter of a few minutes to complete the application form. All you need is your income details and Social Security number, based on which you will receive a rate quote.

    When it comes to banks, you might have to fill in a hard copy of an application or an online form. Despite many seemingly irrelevant questions in the form, fill it out completely to expedite the process. 

    The Time It Takes To Get Approved 

    Online lenders usually require several days to approve a loan. You can expect 5-7 days for getting your mortgage loan approved, for example.

    Banks sometimes offer a quicker approval process and in some cases, you might receive funds the same day. However, the application review process can take longer. Banks have to review your credit history and verify the information you have shared in your application form.

    Getting The Funds

    When online lenders approve your loan, they transfer the amount directly to your bank. Receiving the funds depends on how quickly your bank clears the transfer in your account. You can expect this to take up to seven days when considering weekends and bank holidays.

    Banks usually transfer the funds on the same day your application is approved. Often, you can expect a few days to receive the funds.

    Tips For Speeding Things Up

    You should be well prepared and select a lender wisely to speed up the process. Here are a few things that you can keep in mind.

    • Go To The Branch In Person -When you only have a short timeframe, you must always choose a lender that has a quick disbursement process. However, you must also understand that you have a major role to play here. 
    • Always Provide Complete Information To Prevent Any Delays - Any discrepancy or inadequate documentation could lead to an unnecessary delay. If you feel certain conditions will not work in your favor, you must visit the lender’s branch in person. It will help you overcome their concerns and show that you are serious about getting the funds approved quickly. 
    • Gather All Documents In Advance - Your lender will need to verify the information stated in your application form, whether online or a hard copy. It is better to provide that information in advance so that they can move ahead quickly. The lender will usually need information related to your income and identity. This could include your pay stubs, driver’s license or passport number, and income-related details like monthly expenses and total income from various sources.
    • Make Sure Your Application Is Without Errors - You must fill the application form thoroughly while calm and composed. If you move along quickly while filling in the form, you may make errors. This can prove very costly, especially if you are in urgent need of money. An application form with errors might get rejected immediately and it would take a few days before the application form comes back to you, highlighting the error you made. It can lead to valuable time lost.


    When you have decided to borrow, it becomes important to assess all the possibilities, including low income loans. You should consider banks, credit unions, and online lenders to determine the right option. At the same time, you must know the best ways to get out of debt quickly in case you aren’t eligible for borrowing.

    Be wary of payday loans and other loans with higher interest rates. Keep all your important personal information handy to expedite the process. Also, ensure that you do not make any errors while filling in the form. 

    After following these steps diligently, you may well receive the urgent funds you need in just a few days.