Personal Loan Approved? Here's What To Do Next!

Personal Loan Approved? Here's What To Do Next!


 #TFW Your Personal Loan Has Been Approved

So you’ve just been notified that your personal loan was approved, congratulations!

Now even though you may be excited to have the funds you need, these next steps are important to ensure that the loaned funds are used wisely i.e. for the purpose it was taken out for.

For instance, you may have applied for a personal loan to pay off debts or to consolidate your credit card balances.

However, since a conventional personal loan can be used for just about anything, the temptation for one to take the loan money and spend it on something unplanned is always a possibility!

This is especially true for those with unhealthy spending habits.

Impulsive buyers and those with generally poor money management skills should also be careful not to blow their loan money before paying off the necessities. 


Note: If you are taking out an Islamic personal loan, you will be required not to use the funds for purposes that go against Shariah principles.


Unfortunately, if you do end up using all your loaned funds on a shopping spree or luxury holiday instead of paying off your borrowings as planned, you’ll be in an even deeper financial hole with new debt to clear.

Understanding what comes after your loan has been approved and planning for it can be super helpful for newbie recipients.


What happens after a personal loan is approved?

After you’ve done a happy dance for your personal loan approval, you might be interested to know what comes next. 

For instance, how the money is disbursed and what else you might need to do before and after receiving the funds.

Do note that the exact process upon loan approval varies with banks. This general snapshot should help give you an idea of what to expect next:


Receive notification and loan kit

If your loan is approved, the bank will notify you, usually with a phone call, through email or via post.

In your written email or postal notification, you’ll typically receive a loan kit with basic information about your loan such as the rate, expected date of disbursement, etc.

You may also be given a soft copy of your loan agreement and other documents.


Delivery of printed documents

You’ll also receive a printed copy of loan documents for your to sign and return to the bank.

Once you have signed and returned the papers, it is assumed that you have accepted the terms of your loan contract.

Some banks may automatically assume acceptance once the loan money has been deposited into your account.


Open or activate an account

If you don’t have a savings or current account with the bank, they may open one for you upon loan approval and ask you to activate the account.

Once activated, the bank will then be able to disburse the money into your account.

Some banks may require you to open an account with them at the time of your loan application.

Joint accounts are usually not allowed and so you’ll likely need to open a personal account to receive the loan.


Money is disbursed

Upon approval of your loan and after all conditions have been satisfied as above i.e. opening or activating an account with the bank and signing contract documents, your loan money will be disbursed (if no other issues come up).

Depending on the bank and type of loan, you may receive your funds in as little as 24 to 48 hours after obtaining approval. 

If stamp duty and other fees are to be charged, they will be deducted from the loan first.



Once you’ve receive your loaned funds, you’ll have to fulfil your obligation to repay the loan.

You’ll typically be given 60 days from the loan disbursement date (varies with banks) to begin repayments.

Some banks may insist that you set up an auto repayment function like a standing instruction. 

With certain loans for government employees, a salary deduction via Biro Angkasa might be required.


What to do after your personal loan is approved and disbursed?


1. Have a plan in place and follow through

It’s possible for applicants to take out a personal loan to cover a few needs at once.

For instance, you may apply for a loan to pay of high-interest credit card debt and also to use the money to pay for a professional education course.

In this case especially, it’s best to have a plan in place to ensure that the funds are divided properly. 

Do prioritise debt repayment where possible. Start by paying off what you owe and only then, move on to pay for other causes on your list.

Also, if you are using the money to start a business, drafting an expense plan for your borrowed funds is necessary to maximise its usage. Avoid making unplanned purchases, whenever possible.


2. Don’t procrastinate

Once the money is in your account, try not to waste time. Use your personal loan to settle your dues as planned.

If it is to pay off high-interest creditors, arrange for payments to be made to them immediately.

If you need to cover emergency home repairs, meet with your contractor to discuss payment terms.


3. Don’t carry the cash around

As a general safety precaution, avoid withdrawing your loaned funds and carrying the large sums around to make payments.

Most personal loan funds will be banked into an account. So be sure to make arrangements to pay from your account through a transfer, especially for large sums.

This way, you’ll have a record of the payment and be able to track your funds.


4. Ask for discounts

Remember that cash is king.  Since you are paying with cold hard cash from your loan funds, try asking for cash discounts or other benefits, where possible.

For instance, if you are covering tuition fees in a lump sum with cash, do ask for a discount.  If you are paying vendors in full, don’t hesitate to negotiate for a better price. 


5. Be prompt with repayments

It’s important to make good on your promise to repay once your loan has been granted. This will help build good credit and improve your chances for loans in the future, at better rates.

If you have trouble keeping up or managing instalments, do set up a standing instruction for a remittance to be made to the bank before it is due every month.

Need a personal loan to help finance your dreams of starting a business, getting a college education or clearing off debt?

Be sure to look out for top-rated personal loans to discover the most affordable financing options with the best terms!