Existing lenders provide personal loans top up to current borrowers of personal loans so they can access extra loan amounts over and beyond their ongoing personal loan balance. This loan amount is often offered to a chosen group of current personal loan customers who have a good history of loan repayment and have successfully completed a predetermined number of EMIs.
A top up personal loan can be used for a variety of personal objectives, much like a personal loan, including paying for house repairs, vacations, weddings, and other personal expenses.
Features of Personal Loan Top Up
The following are some essential features of Personal Loans Top Up.
- Only available on an existing personal loan :- If you already have a personal loan, only then you can apply for a personal loan top-up.
- No Security/Collateral Required:- Most lenders do not require security or collateral from borrowers in order to be granted a top-up personal loan. They might also not require a guarantor.
- Attractive interest rates:- Banks and other financial organizations often give extra loans at the same rate as the personal loan that was initially approved. Depending on the applicant’s credit profile, different top-up personal loan interest rates will be provided.
- Loan Amount: However, after allowing for the amount of the borrower’s outstanding personal loan, the total amount of top-up personal loans would not exceed the total loan amount for which the borrower was eligible.
- Flexible repayment period: Top Up personal loan can be availed for a tenure ranging between 12 to 60 months, as long as it doesn’t exceed the remaining balance of your current loan.
- Flexible repayment period: Top Up Personal Loan can be availed for a tenure ranging between 12 to 60 months., as long as it doesn’t exceed the remaining balance of your current loan.
- Also available on balance transfers: Some financial institutions also offer top-up personal loans for balance transfers. These options are appropriate for borrowers who are not able to or are paying higher interest rates for top-up personal loans from their current lenders.
- Quick processing and reimbursement: In contrast to applying for a new loan, borrowers who have already received a personal loan from the lender and have already been subjected to checks can be authorized for a top-up personal loan much more quickly.
Interest Rates For Personal Loan Top Up
The interest rate on your top-up personal loan is often the same as the interest rate on your current or previous personal loan. Interest Rates for personal loan top up for different lenders are as follows:-
|Banks/ NBFC||Interest Rate||Minimum Loan Amount||Maximum Loan Amount|
|State Bank of India||12% to 14.75%||25,000||15 lakh|
|HDFC Bank||10.40% onwards||At the discretion of the bank||At the discretion of the bank|
|Axis Bank||15.75% to 24%||50,000||15 lakh|
|IDFC Bank||12% to 19%||50,000||20 lakh|
|Bank of Baroda||11.70%||Metro and urban – 1 lakh|
Semi-urban and rural – 50,000
|Metro and urban – 10 lakh|
Semi-urban and rural – 5 lakh
|Kotak Mahindra Bank||10.99% to 24%||50,000||15 lakh|
Eligibility criteria for a Personal Loan Top Up
The criteria for personal loan top-up differ from bank to bank. However, there are some common conditions that are taken into account. The following can be said about these aspects:
- Repayment record:- Personal loans are unsecured loans.
A personal loan top-up will therefore also be unsecured.
Lenders in these situations minimize the risks as much as possible. You must have a perfect repayment history in order to be qualified for a personal loan top up. Clean repayment history suggests that there is no risk involved.
- Having an existing Loan:-
A loan that is already in existence obtains a personal loan top-up. Therefore, in order to apply for a personal loan top up, you must already hold a loan.
Documents Required for Personal Loan and a Top-up
Since the paperwork and documentation are already completed and approved for the existing loan, the documentation process for personal loans top up is quite minimal.
The following list includes the typical documents needed to apply for a personal loan which will be used while you apply initially for a personal loan
- Identity proof like a Passport, Aadhaar card, Election Commission card, PAN card, or Driving license.
- Salary slips for 3 months (in case of salaried Individuals).
- Utility bills, a passport, a rent agreement, or another document serving as proof of residence
- A 3 month bank statement with income detail.
- Passport-size photographs.
Can I modify the date on which I can pay my loan installment?
The majority of lenders provide you the option to modify the due date for your loan’s installment payments. Your bank may, however, impose additional PDC swap and rescheduling fees in connection with the request.
What benefits does Personal Loan Top Up offer?
The approval process for a Personal Loan Top Up is rather quick and simple because you’ve previously taken out such a loan from the bank.
What Will Happen To Your Current Loan?
Lenders create a new loan account for you when you take out a personal loan top-up. Along with the personal loan top-up amount, the current loan’s outstanding amount is also on this new loan account.
Why do I have to Pay a Fee for a Personal Loan Top Up ?
Standard processing fees also apply to personal loan top-up because they are predominantly new loans.