Debt Fund Raise · Question

What happens between submitting a proposal and receiving a sanction letter?

Short answer

After submission, the lender screens the proposal, checks documents, studies financials and cash flow, verifies the business and security, gets legal and valuation opinions, prepares an internal appraisal note and takes it to a credit approving authority. If approved, it issues a sanction letter with terms. Timelines vary and no lender can promise an outcome or a date.

In more detail

Most of the time is spent inside the lender, and much of it is invisible to you. Knowing the stages makes follow-up calls more useful.

First comes screening. The relationship team checks that the proposal fits the lender's policy and that documents are complete. Gaps are returned to you as queries. An early indication, sometimes called in-principle approval, may be given, but it is not a commitment to lend.

Credit analysts study financial statements, cash flow, ratios, existing borrowings and the credit history of the company and promoters. They test your projections against past performance and sector conditions. A site or office visit usually follows, and for new projects, technical and market reviews may be added.

Where property is offered, independent valuers and legal advisers examine title, encumbrances and the ability to create a charge. This stage can take time, especially when ownership papers are old or incomplete.

The appraisal note, with a recommended structure, goes to the sanctioning authority. Larger or riskier proposals pass through committees. The authority may approve, approve with changes, or decline. If approved, the sanction letter lists amount, tenure, pricing, security and conditions. Disbursal comes later, after you accept and complete documentation.

Reply fast and in one go

Answer queries completely and quickly. Piecemeal replies restart parts of the review and are a common cause of delay.

Key points

Stages include screening, financial appraisal, site visits, legal and valuation checks, and credit approval.
An early indication of interest is not a binding commitment to lend.
Property title and valuation checks often take the longest.
The sanction letter sets amount, tenure, pricing, security and conditions.
No lender or adviser can promise approval or a delivery date.

Who this applies to

Borrowers who have submitted a proposal and are waiting for a response.
Finance heads planning disbursal timelines around a sanction.
First-time applicants unfamiliar with how lender appraisal runs.

Last reviewed 3 October 2026

This answer is general information, not advice on your particular case. Terms, eligibility, and requirements change, so check the current position with the relevant institution or authority. Lalsar Holdings' financial advisory and financing work is advisory and facilitation only. Lalsar Holdings is not a lender. Sanction and disbursement of any credit facility is at the sole discretion of the partner bank, NBFC, or financial institution involved, subject to their own eligibility criteria and credit policy.