What is Approval?

Approval is the lender's decision to offer financing after reviewing your application and documents. An approval usually specifies the amount, rate or factor rate, term, payment schedule and conditions. Many approvals are conditional, meaning certain items such as additional documents, an appraisal, or verification of information must be satisfied before funds are released. Approval is not the same as funding, and terms can change if new information comes to light before closing.

Example

A lender approves a $75,000 term loan subject to receiving the most recent month's bank statement.

Related terms

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