Need Extra Funds? A Top-Up Loan Might Be Your Smartest Shortcut

When financial needs arise, you may instinctively turn to your savings. In such cases, the prudent approach is to find a way to meet your financial needs while protecting your financial cushion. One way to do so is to opt for a top-up on your existing loan. This article explains why you should choose top-ups on a loan instead of dipping into your savings.

If you already have an ongoing Personal Loan and a good repayment track record, there are options that allow access to additional funds digitally. 

You can consider a top-up on your Personal Loan to get extra funds. You can use these funds for any purpose, whether planned or unplanned.

Here’s what you need to know about top-ups:

1. You already have an existing Personal Loan

2. You build a good repayment track record. 

3. The bank may offer a Pre-Approved Top Up.

4. You can start the 100% digital process.

5. Your loan amount and EMI are recalculated.

Here’s an example to help you understand top-ups on loans in detail:

• Let’s say you have an existing personal loan of ₹3,50,000, out of which ₹1,50,000 is still outstanding.

• Based on your repayment record, you are eligible for a top-up of up to ₹3,50,000.

• You choose a revised loan amount of ₹2,96,000, which first clears the outstanding balance.

• The remaining ₹1,46,000 is the additional amount you receive, and your EMI is recalculated accordingly.

• Access Extra Funds Without Using Your Savings

A top-upon Personal Loan allows you to manage sudden expenses without dipping into the money you’ve set aside for future plans or emergencies.

• Keep Your Financial Safety Net Intact

By not breaking deposits or selling investments for short-term needs, you can continue to stay financially prepared for situations where your safety net truly matters.

• One Loan, One Simple EMI

Another advantage of a top-up is that instead of managing multiple loans or repayments, the additional amount is usually combined with your existing Personal Loan. This means one revised EMI.

• Accessible Via Digital Platforms

Since you already have a loan with the bank, the process to apply for a top-up is often simpler and 100%digital. 

• Flexible Use for Any Need

The extra funds can generally be used for both planned and unplanned expenses, without restrictions. This flexibility helps you manage different financial needs smoothly.

HDFC Bank brings together the trust of a long-standing banking legacy with easy-to-use digital platforms that simplify loan management. You can view loan details, understand revised repayment amounts and manage changes online with confidence with our NetBanking and MobileBanking platforms. Need of extra funds can arise at any time, for any purpose—emergency, travel or debt consolidation. Know how you can take care of the extra expenses easily.

What can I use a top-up loan for?
The additional amount can usually be used for many reasons like travel, medical emergencies, wedding expenses etc.  

How are EMIs calculated for a top-up loan?
The existing loan balance is typically combined with the additional amount, and a new EMI is calculated based on the revised loan amount, tenure and applicable interest rate.

*Disclaimer: Terms and conditions apply. The information provided in this article is generic in nature and for informational purposes only. Loan disbursement is at the sole discretion of HDFC Bank Limited and is subject to verification and documentation as per the bank’s requirements. Interest rates and offers may vary. Please check the official website for the changes/updates in the application procedure and other details.