23 March, 2025 | 11:01 IST
Personal loan top-up facilities play a crucial role when you need additional funding. You can borrow some extra amount based on an existing loan without going through the hassle of the application process and approval again. First, you must have an existing personal loan with the same lender, as the top-up loan is an extension of your current loan. Many lenders also require that you have completed a certain number of repayments on the original loan, typically six months or more. This ensures that you have a stable repayment history before being considered for the top-up loan.
Your credit score and the repayment history on the existing loan play a crucial role in availing additional borrowing. Lenders will evaluate your creditworthiness to determine whether you can repay a top-up loan. A high credit score indicates that you are financially responsible and can manage more credit. Lastly, lenders will assess your income to ensure that you have the financial capacity to comfortably repay both the original and the top-up loan.
If you are looking for a personal loan top-up, you can explore multiple offers on Moneycontrol app or website. The loans come with an affordable interest rate as low as 10.5% per annum. Moneycontrol has partnered with eight lenders to offer personal loans up to Rs 50 lakhs in a completely digital process.
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To apply for a personal top-up loan, certain documents are typically required. These include:
1. Additional Loan Amount
There are times when borrowers may need additional funds even after availing a personal loan. So, the top-up loan facility allows them to borrow extra amounts on their existing personal loan without applying for a new one.
2. Minimal Documentation
Since the lender already knows the borrower’s financial history, the documents required for a top-up loan are minimal. This reduces paperwork and speeds up the approval process.
3. Quick Approval Process
Due to the borrower’s existing relationship with the lender, the process of getting approval for a top-up plan is faster as compared to applying for a new loan. The lender is familiar with the borrower’s repayment history, so there’s less paperwork and the loan amount could be disbursed within a few hours.
4. Interest Rate
The interest rate for a top-up loan is usually similar to the existing loan. If the borrower has a history of timely EMI payments, the lender may offer a lower interest rate, making the top-up loan more affordable.
5. Repayment Tenure
The tenure for the top-up loan may match the original loan’s duration or be adjusted according to the borrower’s preference. For example, if there are two years left on the original loan, the top-up loan could also have a two-year repayment period. If the borrower doesn't want to align the top-up loan with the existing loan tenure, some lenders also entirely revise the tenure.
1. The first step is to contact your lender and know if you are eligible for a top-up.
2. If the lender confirms your eligibility, then submit the application either via a website, mobile app, or by visiting a branch.
3. Some lenders may ask for necessary documents such as income proof, address proof, bank statements, or existing loan details.
4. Once the verification is done, the lender will offer a top-up loan and accordingly the interest rate and tenure is decided.
5. After the approval is made, the amount will be credited to your account.
Most leading banks and non-banking financial companies (NBFCs) are offering personal loan top-ups. You can avail of a personal loan top-up on your existing loan from leading banks like the State Bank of India, Punjab National Bank, HDFC Bank, ICICI Bank, Axis Bank and Kotak Mahindra Bank, among others.
Personal loan top-ups could be useful for borrowers, who want to get access to additional funds on an existing loan. The facility can also help to consolidate your debt. However, while availing a personal loan top-up, it’s important to consider a few key factors like the interest rate, fees and tenure to reduce the overall debt burden. If you are looking forward to more funds, you can access personal loan offers up to Rs 50 lakhs from eight lenders on Moneycontrol’s digital lending platform. You can apply for loans in a 100% paperless process through the Moneycontrol app and it takes a few minutes to get approval. These loans start at an annual interest rate as low as 10.5%.
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