What is a Top-up Personal Loan?
A Top-Up Personal Loan is an additional loan amount that existing personal loan borrowers can avail from their current lender. This facility is usually offered to borrowers who have a satisfactory repayment history and have repaid a specific number of EMIs on their existing loan. Like personal loans, top-up loans can be used for multiple personal needs – weddings, vacations, medical expenses, home renovation, and more.
Key Features of Top-Up Personal Loans
- Eligibility: Offered only to existing personal loan borrowers having good credit history and repayment capacity.
- Security: Usually does not require collateral or guarantor.
- Interest Rates: Generally same as the original loan; depends on credit profile.
- Loan Amount: Varies across lenders; cannot exceed the overall loan eligibility after factoring in the outstanding loan amount.
- Tenure: Usually ranges from 12 to 60 months, but not more than the remaining tenure of your current loan.
- Disbursal: Faster approval due to existing relationship with the lender.
- End Use: Funds can be used for any legitimate personal or business needs.
Top-Up Loan – Interest Rates & Charges
Facility | Charges |
Interest Rate | Usually same as the existing loan rate |
Loan Processing Charges | Up to 6% of loan amount |
Part-Payment Charges | As per the loan agreement |
Foreclosure Charges | Up to 7% of principal outstanding |
Note: Rates and charges may vary across lenders.
Eligibility Criteria for Top-Up Personal Loans
To be eligible for a top-up personal loan, you must typically meet the following criteria:
- Must have an existing personal loan with the lender
- A minimum number of EMIs (usually at least 6 EMIs) should have been paid of the existing personal loan
- Good credit score and repayment track record
- Adequate repayment capacity
Documents Required to Avail Top-up Personal Loan
Minimal or no documentation required as you’re already servicing personal loan with the lender.
How to Apply for a Top-Up Personal Loan
Online Process:
- Log in to your lender’s portal
- Check if you have a pre-approved offer
- Fill in the application and submit (if required)
- Loan disbursed post quick verification
Offline Process:
- Visit your lender’s nearest branch
- Request top-up loan application form
- Submit the form with required documents (if any)
- Loan sanctioned after evaluation