Loan origination is the process through which a borrower applies for a loan and a lender evaluates the application. This process includes gathering necessary information, such as the borrower's credit history, income, and financial situation. The lender uses this information to determine whether to approve the loan and under what terms.
Once the loan is approved, the lender prepares the necessary documents, including the loan agreement. This stage may involve negotiations on interest rates and repayment terms. Successful loan origination results in the borrower receiving funds, which can be used for various purposes, such as purchasing a home or financing a business.
