Top-Up Loans VS Fresh Loans

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Top-Up Loans VS Fresh Loans

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Should you get a Top-up Loan or a Fresh Loan? is the question many are asking today, in this Finance Buddha PPT we have explained the difference between Top-up Loan & Fresh Loan. – PowerPoint PPT presentation

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Title: Top-Up Loans VS Fresh Loans

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Top-up Loan Or Fresh Loan
https//financebuddha.com/blog/should-you-get-a-to
p-up-loan-or-a-fresh-loan/
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Top-Up Loan

A top-up loan is a facility provided by the bank
to its existing loan account holders. This
facility helps borrowers to get additional
funding over and above their existing loans.
However, a top-up loan facility is available only
for a home loan or Personal Loan.

The benefits include
Immediate funding
No need to go through all the processes
Low- interest.
Reliable backup as you already have an existing
relation with the lender

https//financebuddha.com/blog/should-you-get-a-to
p-up-loan-or-a-fresh-loan/
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Lets understand this more clearly with the
calculation by comparing both the options.

The interest rate for existing home loan 8.5
The interest rate for a new personal loan will be
10.35
EMI for home loan 56,366 monthly
EMI for the new personal loan 10,210
If they take a top-up loan rather than a new
personal loan he will get it approved at 7.5 as
the home loan rates have reduced now.
So, its for sure that Suresh will be able to
save more if he avails a top-up home loan.
The same is true with personal loan top-ups. If
you are already servicing a personal loan and
feel the need to borrow again. Then, in that
case, you have two options
getting a top-up personal loan or
availing a fresh personal loan.

https//financebuddha.com/blog/should-you-get-a-to
p-up-loan-or-a-fresh-loan/
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Features of a top-up loan

Simplified documentation process
Easy and faster approval
low rate of interest
Lower EMIs
Hassle-free process.
Availability of longer tenures

Important Note Same as any other loan, a top-up
loan also has processing fee charges,
cheque-bounce fee and other fees apply. So, its
very important to come to any conclusion once you
have done the proper calculation and research. A
Top-Up Loan also comes with tax benefits under
section 80C and Section 24 of the Income Tax Act,
but to avail this its important to utilize
borrowed money for home reconstruction/renovation
or for education purposes. You may need to
provide proof in order to avail of these tax
benefits.
https//financebuddha.com/blog/should-you-get-a-to
p-up-loan-or-a-fresh-loan/
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