Whether planning a wedding, a dream vacation, or a home renovation, a Kotak811 Personal Loan can help you achieve all of them. A lot goes on behind the scenes once you apply for a Personal Loan.
This guide will walk you through the disbursement process, step by step, so you can understand how your loan moves from application to approval to disbursement.
Understanding the basics of personal loans
A Personal Loan is a lump sum you can borrow for various purposes, such as consolidating debt, home renovations, or a wedding. You will repay the amount plus interest in equated monthly instalments (EMIs) over the loan term. In India, top financial institutions, including Kotak811, NBFCs and online lenders offer Personal Loans.
What is a loan disbursement in personal loans?
A loan disbursement is when a lender gives funds to a borrower as part of a loan agreement. The funds are then available for use in the borrower's account. The disbursement can take many forms, depending on the loan terms and the agreement between the lender and borrower. For example, the loan amount may be given to the borrower in one lump sum at the beginning of the term, or it may be released in instalments.
There are 2 different types of loan disbursement:
- Full disbursement. The entire loan amount is given to the borrower in one go - for example, a Personal Loan for a fixed rate.
- Partial disbursement. The loan amount is divided into smaller chunks, and each chunk is disbursed as the borrower meets specific requirements - for example, Construction-linked Home Loans.
Before disbursement, we verify the following:
- The loan application of the individual
- The documents submitted, along with the credit score
- Whether the applicant is eligible for the desired loan amount
Must Read: 5 Things You Should Know About Personal Loan
How does the personal loan disbursement work?
A Personal Loan disbursement has many steps. From application, and disbursement to repayment, this section covers it all for you to understand the process in detail.
1. Application process
The first step is the application process. You must research multiple lenders and loan options. Once you have selected a reliable lender like Kotak811 and loan type, visit the app or website and duly fill out the form. Kotak811 will start the approval process after receiving your application. The process takes 24-48 hours, depending upon your request. The process is faster if you are an existing Kotak customer.
2. Documentation & verification
We then verify your information based on your details and documents provided. It is essential to provide legal and accurate documents to avoid inconvenience and get quick loan approval and disbursement.
3. Loan approval
Once you have applied, we will assess your information. While carrying out the Personal Loan disbursement process, Kotak811 considers factors such as credit score, income, employment and debt-to-income ratio. We contact the credit bureaus to check your financial obligations reflected in your credit history.
You must have a stable income to ensure you can repay the loan amount timely. We can contact your employers to confirm your employment status, tenure and income.
We decide on the loan application based on credit assessment, income verification, employment verification, DTI ratio calculation, and collateral evaluation (if applicable).
4. Loan disbursement
Once your loan is approved, we will send you a sanction letter via email or post. The sanction letter will state that your loan application has been accepted, along with additional information such as the interest rate, loan amount, EMI, etc. You can now access the funds for various purposes.
Kotak811 carry out the loan disbursement process through two mediums:
Direct deposit: Direct deposit is a service that automatically transfers money from one account to another, such as a bank account. It is free and can be done using a bank account, debit card, online banking, or mobile app. It is the most convenient and used method for the fund transfer.
Cheque: Kotak811 can issues a cheque in the name of the borrower, which they can collect from the branch and deposit to their bank accounts.
Once the loan is disbursed, we will send you a confirmation letter. This might be sent via e-mail or post. The confirmation letter usually comes with a welcome kit.
The welcome kit will contain complete information on your Kotak811 Personal Loan, including the EMI, amortisation table, EMI payment alternatives, due date, and customer support.
The loan disbursement time after approval is quick. Kotak811 usually disburses the loan on the day of the approval.
Must Read: Understanding Personal Loan Foreclosure
Repayment terms
The repayment tenure begins immediately after the Personal Loan disbursement process. The tenure starts from the following month after disbursement. Before applying for a loan, you should assess your finances and repayment capabilities, and select a loan tenure with affordable EMIs. Pay your EMIs on time to create a healthy credit history and return your loan before the term ends without straining your budget.
You may view your repayment terms on your net or mobile banking.
- Login to net/mobile banking
- Select Personal Loan
- Click on overview
- View/download statement
Tips for a smooth disbursement process
Many users ask – the loan is sanctioned but not disbursed, you must know that a loan sanction is the approval of the loan. Meanwhile, the disbursal is the actual transfer of the amount. Also, here are some tips for a smooth disbursement process:
- Double-check the documents before submission. Ensure you have all the documents and upload them in the asked format. Also, check the Personal Loan fees & charges to maintain sufficient funds in your bank account.
- Openly communicate with the lender. Kotak811 is known for its user-friendly services. If you have any queries, immediately get in touch to get your queries resolved.
- Carefully read the terms and conditions before signing the loan agreement. Make sure there are no hidden clauses.
Apply for a Personal Loan with Kotak811 today!
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This Article is for information purposes only. The views expressed in this Article do not necessarily constitute the views of Kotak Mahindra Bank Ltd. (“Bank”) or its employees. Bank makes no warranty of any kind with respect to the completeness or accuracy of the material and articles contained in this Newsletter. The information contained in this Article is sourced from empanelled external experts for the benefit of the customers and it does not constitute legal advice from Kotak. Kotak, its directors, employees, and contributors shall not be responsible or liable for any damage or loss resulting from or arising due to reliance on or use of any information contained herein.
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