A Step-By-Step Guide To Apply For A Top-Up Personal Loan

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A top-up loan is a loan offered by a lender with a higher amount of interest than the loan applied for under the main loan category, such as a personal loan, an education loan, a home loan, and so on. 

Applying for a Top-Up personal Loan is only possible if you are already familiar with the lender and have an existing relationship with them. The debtor may be able to apply for a loan if a certain period has passed since the original loan was disbursed to them. 

The borrower can transfer their loan to another lender or bank if the current lender does not offer a Top-Up personal Loan. A top-up personal loan comes with a smaller processing fee and a lower interest rate, which one may calculate using an interest calculator.

A Top-Up personal Loan might be a better choice for borrowers rescheduling their existing loans rather than taking out a personal loan. You must be aware that not all applicants will be approved by their bank or lender for a top-up loan. 

When assessing an application for a top-up loan, the lender will still consider the borrower’s finances, repayment capacity, and any other outstanding loans that the borrower may have.

Top-up personal loans- How to apply?

  • Contact your existing lender to find out if any top-up personal loan offer is running on your account.  
  • You can opt for a balance transfer if your existing lender does not provide a top-up for your loan, allowing you to transfer the loan to another lender. 
  • You should fill out the online application form after you have received details from a lender. 
  • Documents need to be submitted promptly. 
  • After your top-up personal loan is approved, your bank account will be credited with the loan amount in 24 hours.  

 Also Read : Pros And Cons Of Instant Personal Loan

Benefits of Top-Up Loans

Reduce Loan Burden

There are many reasons why Indians choose to take out Top-Up personal loans. Still, one of the main reasons is that they enable them to consolidate their existing loans and minimize the overall interest rate on loans. To reduce the burden of paying multiple loans simultaneously, you can take out a top-up loan on your personal or home loan while paying off other debts.

Minimal documents required

Most Indian banks offer Top Up personal loans with simple and minimal documentation requirements. Even many lending institutions provide the best personal loan offers to their existing customers. This is because most customers have an existing relationship with the bank as well as that the bank knows how their credit history. 

You can use the top-up loan calculator to determine how much top-up loan you will need and how much the EMI amount will be if you are unsure how much top-up loan you will need to apply for.  

Quick Approval

Since the banks already have a relationship with the top-up loan applicants, the approval process for a Top-Up personal Loan is much quicker than for a person or a home loan. Aside from that, as the bank is aware of the applicant’s credentials, the amount’s disbursement is also faster. Thus, a top-up loan can be a great way to get immediate access to funds and meet your needs in an emergency.

Interest Rate

The interest rate is one of the most important things to consider when applying for any loan. As compared with other unsecured loans, most lenders in India offer their clients attractive interest rates on Top-Up personal loans. 

In addition, this is one of the primary reasons why many people prefer to take out a Top-Up Personal Loan, as it is easy for them to manage their repayments. In some countries, applicants can choose between a floating rate or a fixed interest rate when applying for their Top-Up Personal Loan.

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