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Walk, run sprint: Personal loan—how long does it take to get approval and funding?

How Long Does It Take to Get a Personal Loan?
Betsalel Cohen
UpdatedFeb 25, 2024
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    5 min read
Key Takeaways:
  • A good credit score can significantly speed up the personal loan approval process.
  • Preparing your necessary documents ahead of time can help you get your personal loan faster.
  • Different types of lenders have different approval and funding timelines, so it's important to research and compare options.

Getting a personal loan can be like taking a walk around the park. The time it takes to complete a walk depends on the pace you choose, the route you select, and your physical shape. Similarly, the time it takes to get a personal loan can change depending on your financial situation and how you get it. The process might be quick and easy if you have great credit and a low interest rate. On the other hand, if you're struggling to meet your basic needs or have a high interest rate, the process might take longer.

There are many reasons to take a personal loan. Some popular ones are home repairs, paying for expensive dental bills, consolidating debt, or paying for a dream vacation. Some are urgent, while others are less pressing.

Factors like your credit score, income, and the lender you choose can all affect the timeline for approval and funding. We'll look at the typical timeline for the personal loan process and how long you can expect each step to take. So whether you prefer a leisurely stroll or a brisk power walk, let's explore how long it takes to get a personal loan.

How long it takes to get a personal loan—summary table of steps and estimated times

Here's a table outlining the personal loan process and the estimated time it may take for each step:

StepEstimated Time
Research and compare lenders1–2 days
Pre-qualification/application1–2 days
Lender review of application1–7 days
Verification of information1–3 days
Loan approval1–7 days
Acceptance of loan offer1–2 days
Loan disbursement1–5 days
Total estimated time to get a personal loan5–21 days

Please note that these are just estimates. The actual time may vary depending on factors such as the lender's process and the completeness of the applicant's documentation.

The typical timeline for personal loan approval and disbursement

Using the internet, you can learn about personal loans and the types of lenders and get a pretty good idea of what terms are offered.

Get pre-approved: The next step is to get pre-approval, which isn't a binding offer. In general, this is a rapid process. You can fill out an online form, provide basic information, and let the lender do a soft credit check.

Make an application: If you are pre-approvedcongrats. Your next step is to submit an application. If you are working with an online lender, that can be a very smooth process. You'll need to provide basic information about your id and income.

Getting approval: The approval process for a personal loan usually takes a few days to a few weeks. During this time, the lender will review your application, credit score, income, and employment history

Funding: The lender's funding process usually takes a few days to a few weeks, depending on the lender and the method of disbursement. Some lenders may deposit the funds into your bank account. Others may issue a check or send the money via a third-party service.

Factors that affect personal loan approval time

Are you looking to get approved for a personal loan? Well, several factors can affect how long you wait to hear back from lenders. Let's dive into what those factors are, so you can be better prepared for the wait. Here are some of the most common factors that can affect personal loan approval time:

  • Credit score
  • Income and employment history
  • Loan amount
  • Security (if applicable):
  • The lender's process

Credit score: One of the most important factors lenders consider when approving your loan application. You're more likely to get approved quickly with a high credit score. In contrast, a lower credit score may result in a longer approval process or even a loan denial.

Income and employment history: Lenders will also look at your income and employment history to determine whether you can repay the loan. Suppose you have a stable job and a good income. In that case, you may be approved more quickly than someone with an unstable employment history or lower income.

Loan amount: The loan amount you're applying for can also impact the approval time. Smaller loans may be approved more quickly than larger loans, as they pose less risk to the lender.

Security (if applicable): If you're applying for a secured personal loan, the lender may require collateral to secure the loan. This can add time to the approval process. The lender will need to assess the value of the collateral before approving the loan.

Lender's application and approval process: Some lenders have faster turnaround times than others and may be able to approve your loan application more quickly.

3 Ways to Speed Up the Process

Here are three ways to speed up the process:

  • Improving credit score
  • Preparing necessary documents ahead of time
  • Applying with a co-signer (if necessary)

Improve credit score: First, try to improve your credit score. Lenders typically prefer borrowers with good credit. Taking steps to boost your score can increase your chances of approval and get you a better interest rate. This might include paying down credit card balances, disputing errors on your credit report, or making timely payments.

Prepare all your documents in advance: Another way to speed up the process is to prepare all necessary documents. Prepare proof of income, bank statements, and tax returns. Having these documents ready and organized can help you avoid delays and make the application process go more smoothly.

Poor credit - look into a co-borrower: Consider applying for the loan with a co-signer. A co-signer agrees to take responsibility for the loan if you can't repay it. Suppose you have a co-signer with good credit. In that case, it can improve your chances of approval and get you a better interest rate. However, remember that you and your co-signer will be equally responsible for repaying the loan. So choosing someone you trust and who understands the risks involved is essential.

How long does it take to get a personal loan from different types of lenders?

Different types of lenders may have varying approval and funding timelines for personal loans. Here are some general guidelines for how long it may take to get a personal loan from different lenders:

  • Banks: Traditional banks may take longer to approve and disburse personal loans, as their application and approval processes can be more stringent. Getting approved and receiving ‌funds may take several days or even weeks.
  • Credit unions: Credit unions may have a slightly faster timeline for personal loan approval and disbursement than traditional banks. Credit unions are member-owned and may have more lenient lending criteria. Getting approved and receiving the funds may take several days to a week.
  • Online lenders: Online lenders have become increasingly popular in recent years thanks to their fast and convenient application and approval processes. You can complete the entire process online and receive funding in as little as one business day.

Peer-to-peer lenders: Peer-to-peer lending platforms connect borrowers with individual investors, bypassing traditional financial institutions. The approval and funding timelines can vary depending on the platform and the investors' interest in your loan. However, getting approved and receiving the funds in a few days to a week may be possible.

Frequently Asked Questions

Can I get a personal loan with bad credit?


Yes, you can get a personal loan with bad credit, but the interest rates may be higher , and the approval process may take longer.

How much can I borrow with a personal loan?


The amount you can borrow with a personal loan depends on your credit score, income, and other factors. Generally, lenders offer personal loans ranging from a few thousand dollars to tens of thousands of dollars.

How can I compare personal loan offers?


You can compare personal loan offers by looking at the interest rates, fees, repayment terms, and other terms and conditions. It's also important to check the lender's reputation and customer reviews before deciding.