Top up Home Loan: Have you ever been offered a top-up home loan by the bank? As the name suggests, it is a loan related to home loan. Let us know what it is and what are its benefits. Actually, home loan customers often need money to buy or build a house or for other purposes. In such a situation, instead of taking an expensive personal loan, these customers can take a top up home loan.

interest rates remain low

The interest rate in a top-up home loan is low. Along with this, the customer also gets a good deal. Top-up home loan is offered to those customers who have already taken a home loan. If you need additional money apart from the home loan, then a top-up home loan is a good option. 

Benefits of Top-up Home Loan

• A top-up loan gives the customer a better deal than his existing lender. This reduces your overall cost of borrowing money.
• Top-up home loans allow customers to avail additional loan over and above their existing loan amount.
• If the customer repays the home loan for 12 months without missing any EMI, he becomes eligible to avail home loan top-up.
• Top-up home loans are quite beneficial for customers if you choose a shorter tenure for repayment.
• Many times, there are some additional expenses apart from the home loan. Home loan top up can cover these expenses.
• Top up home loan is an affordable solution to manage your debt.
• The interest rate on top up home loans is usually slightly higher than the rates of regular home loans. These rates also depend on the customer's profile.
• The amount sanctioned by the bank will also depend on the monthly installment repaid in the regular home loan. This will save you from having to apply separately for a personal loan.
• The difference between home loan and top-up home loan rates is usually between 1 to 2 per cent.
• The tenure of top-up home loans varies from bank to bank. For example, State Bank of India offers top-up home loans for a tenure of up to 30 years.