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  3. What are the Prerequisites for Top Up Home Loan?

What are the Prerequisites for Top Up Home Loan?
By Anupama Deshpande | April 30, 2018

A top-up loan, as its name suggests, is a offer of getting additional loan on an existing home loan. The interest rate applicable to top up home loan is the same as home loan rate or may be little higher.



A top-up loan can be taken for any purpose. It is not necessary that it is to be taken for home related purpose, it can be taken for any personal need or business need. It is offered for longer tenure.

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What are the Prerequisites for Top Up Home Loan?

(1) You need to be an existing home loan borrower

You have to be an existing home loan borrower of the same lender where you are applying for a top up loan. If you have taken home loan from bank 'A' then you cannot take top up loan from bank 'B'.

(2) You must have taken the possession/ completion of the financed property

It is necessary for availing top up home loan that you have already taken possession or after completion of the home for which you have availed original home loan.

(3) You should have a satisfactory loan repayment track record

You should have a satisfactory loan repayment track record of minimum one year to few years, which depends upon the lending bank.

(4) Repayment period of top up loan can maximum be upto outstanding tenure of the original home loan

Repayment period of top up loan cannot exceed the tenure of the original home loan, but it can be less than that. Some lenders offer top up home loan for some fixed tenure, say maximum 15 years, but in any case, its tenure must be less than that of tenure of the original home loan.

(5) Total of top up loan amount and outstanding home loan amount cannot exceed the originally sanctioned home loan amount

Maximum top up loan offered is the difference between original home loan amount & outstanding home loan amount.

(6) Top up home loan is offered upto 75% of property value minus outstanding home loan

Top up home loan depends upon finance property value. Maximum top up home loan is offered upto 75% of property value minus outstanding home loan.

(7) Top up home loan can also be availed in case of balance transfer

In case you have opted for home loan balance transfer, in that case also you are eligible for getting top up home loan upon having a satisfactory track record of loan repayment.

Benefit of Availing Top up Home Loan

  1. Simple and Hassle free Documentation
  2. Quick processing that saves time
  3. Easy to avail as you are carrying good repayment track record
  4. Freedom of using the loan amount for any purpose
  5. Available at lowest Interest Rate than other types of loans
  6. Offers Longer Repayment Period
  7. Lower processing charges in comparison to that of other loans
  8. Easy repayment options like EMI, Auto debit, etc.
  9. Income Tax rebate is available if used for home addition, alteration, repairs or renovation

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About Anupama Deshpande
Anupama is a Co-Founder of CodeForBanks.com. She is an MBA (Finance) and Chartered Financial Analyst (CFA). She also carries a Fellowship degree in Life Insurance Sector and is a Master of Computer Application (MCA). She is an expert in Finance Field with an experience of over 18 years on different managerial positions in finance industry including Stock Market, Depository and Mutual Fund Sectors. Apart from that she has remained for few years in the field of marketing as well. Her suggestions and advice for investments have been very useful to many people.
Her vast interest & expertise in the field of finance have encouraged her to write the articles so that others can also get benefitted out of them. She never loses any opportunity to learn and be creative. She is a valuable asset for CodeForBanks.com & important resource to all those around her.

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