Funded Loan

Full definition

Funded is the status a loan enters when the lender initiates the actual transfer of money. For personal loans, the funding sequence is: Application submitted → underwriting review → conditional approval → document verification and signing → waiting period (if applicable) → funding initiated → ACH transfer sent → funds posted to borrower's account. Funding timeline by lender type: Online lenders (LightStream, SoFi, Upstart, Avant): 1-3 business days from final approval. Some lenders offer same-business-day funding for applications approved before noon. Banks: 3-7 business days from final approval due to more manual processes and internal transfer systems. Credit unions: 3-7 business days, though some are faster especially for existing members with established accounts. What happens at funding: The lender initiates an ACH transfer (Automated Clearing House) for the net loan amount (gross amount minus origination fee, if any) to the bank account number provided during the application. Your bank must then receive and process the ACH, which takes an additional 1-2 business days depending on your bank's ACH processing schedule. This is why applying early in the week ensures funds arrive before the weekend - an ACH sent Thursday afternoon may not post until Monday. Direct-to-creditor funding: For debt consolidation loans, some lenders offer to pay creditors directly rather than depositing funds to your account. This is sometimes slightly faster per creditor (the lender has established ACH relationships with major card issuers) and reduces the risk that borrowers spend the funds on other things instead of paying off the targeted debts. Loan funding date vs. first payment date: The first payment due date is typically 30-45 days after the loan funding date. Interest begins accruing from the funding date (the date money is transferred), not the application date.

• Disbursement
• Origination fee
• ACH transfer
• Per Diem Interest