A Top Up Loan is a surplus capital which is offered by a leading lender along with your existing Home Loan. You also get to avail a Top Up Loan when you switch you’re existing Home Loan account from a lender to a new lender.
It helps you avail a loan up to Rs.50 lakh on a reduced rate of interest and an extended tenor. You can also get a 3-EMI holiday on your Top Up Loan to cope up with your existing financial obligations.
In the same context, let’s provide you some features and benefits of a Top Up Loan that will help you to know why a Top Up Loan is a good idea for you, as well as help you avail it to meet various financial needs including emergencies.
What is the working mechanism of a Top Up Loan?
When you have an existing Home Loan, you can ask for an instant Top-Up Loan even after you have availed a Home Loan sometimes, before. With almost no eligibility issues and other aspects, the lender fulfills your request and delivers you Top-Up Loan super-quick.
Thus, when you have an urgent fund need, you can simply rely on Top Up Loan to grab Rs.50 lakh instantly and cover your various emergencies.
Features of Top Up Loan
- Instant access to Rs.50 lakh or a lesser amount as per your needs
- Reduced rate of interest – 8-12% – may vary from lender to lender
- Gives you an extended loan tenor – pay lesser EMIs and save
- Enjoy 3-EMI holidays to streamline your financial outflow
- Negligible eligibility and other terms again depends on your lender
What are the benefits of availing Top Up Loans?
There are various methods to ways you can utilize your Top Up Loan right from covering you in an emergency medical need to helping you avail a foreign trip with family. Have a look!
They do not come with a higher rate of interest
Since it is an additional loan facility which a lender offers along with a Home Loan, it makes the Top Up Loans affordable. Thus, compared to other loans such as personal loans which has a rate of interest as high as 24%, a Top Up Loan comes to you like a breeze of fresh air, giving you respite and indulge in saving.
You can use them in crisis and any situation
Although lenders may monitor the usage of other standard loans, Top Up Loans do not come under the scrutiny of them. You are free to use the funds as per your preferences such as to clear off existing debt, fund your child’s education, go abroad on a trip, cover emergency medical or any other situations and more. The only thing that you need is being an existing Home Loan subscriber and has been repaying all your debts on time. As discussed earlier, leading lenders also provide a 3-EMI holiday to help you ease your financial burden.
You can improve your CIBIL score
Want to give a boost to your existing CIBIL or a credit score? Avail a Top Up Loan! Why? Availing a Top Up Loan does not mean that you are hungry for credit. It also helps you improve your loan eligibility for all future loans that you may need because it also improves the credit score. Is your existing lender not offering you a Top Up Loan? Simply opt for Home Loan balance transfer with a known lender and avail the facility.
Top Up Loans do not need collateral
Since a Top Up Loan is an extended feature of a Home Loan, you don’t need to provide any collateral against it. So, just relax and apply for it without worries.
The Bottom Line
Now that you know the immediate benefits of a Top Up Loan other than covering your emergency needs, it would be good if you go out and avail it and meet your needs. All the best!