Processing fee

A processing fee is the one-time charge a lender levies to evaluate and disburse your loan, typically 0.25% to 1% of the sanctioned amount, often subject to a cap and plus GST. It is usually deducted from the disbursed amount rather than billed separately, so you receive slightly less than the sanctioned figure. It is frequently negotiable, especially during festive offers or for salaried applicants with a strong profile. Ask for the full schedule of charges: legal, valuation and documentation fees sit outside the processing fee and add to the real cost.