The person who have taken a car loan and finds difficult to pay the next EMI, can take an extra loan from bank i.e cash against your car is called as top up loan.

1. What is Top
Up Loan?

3. This scheme has two
benefits:
• This scheme has two benefits:-
• Get an additional loan at the rate of 14%
(HDFC)
• The car loan is 3-4 % cheaper than a
personal loan (17-18%)

4. Top Up Loan Eligibility For
HDFC Bank:
• At least 12 to 18 EMIs of your car should
be paid
• EMI track record should be clean
• Formula to Calculate Eligibility: EMI
Amount x Tenure Paid x Multiplier

5. HDFC
• Loan Amount: Rs. 5,00,000
• Tenure: 60
• EMI: Rs. 11,000
• Tenure Paid: 20
• Total Amount Paid: Rs. 2,20,000
• Remaining Amount to Close: Rs. 5,00,000 – Rs. 2,20,000 = Rs. 2,80,000
• Top-up Amount Eligibility: 11,000 x 20 x 1.5 = Rs. 3,30,000
• Total Loan Eligibility: 2,20,000 + Rs. 3,30,000 = Rs. 5,50,000
• To understand the above concept, Let Tushar Jadhav has a running car loan from HDFC bank.
He has paid Rs. 2,20,000 to HDFC bank by paying 20 EMIs. Tushar required another Rs.
2,80,000 to close the loan. According to eligibility criteria, Tushar will get Rs. 3,30,000 of top-up
loan. HDFC will close his running loan by repaying Rs. 2,80,000 and also providing him an
additional loan of Rs. 3,30,000. Thus, Tushar will become a customer of HDFC and will have a
total amount of Rs. 5,50,000 loan on him. Though the process is lengthier, but the top-up loan
can help him to purchase his dream car as well as great additional loan.
• For the process 1% fees are applied. If we calculate the interest rate it is nearly 14%.

6. Kotak Bank
•The process is called as BTPT (Balance Transfer Plus Top-up)
•Let Tushar have a running car loan from Kotak bank. He paid Between 12 EMIs – 17 EMIs, but
wants some amount to close the loan. So, according to the eligibility criteria of Kotak Bank, Tushar
will get an extra loan as a top-up loan and it will be equal to 25 EMIs. The table shows a top-up
loan you will get as per the Kotak Bank criteria.
•Sr. No. EMIs Paid to Bank Top-up Loan Received From the Bank
•1 Between 12 to 17 EMIs Get Top-up Loan Corresponding to 25 EMIs
•2 Between 18 to 35 EMIs Get Top-up Loan Corresponding to 30 EMIs
•3 From 36 EMIs & Above Get Top-up Loan Corresponding to 35 EMIs
•For the process 1% fees are applied. If we calculate the interest rate it is nearly 17%.

7. Axis Bank
• The process is called as Top-up Funding and it depends on the tenure.
• The top-up loan criteria is different of this bank. Let Tushar has a running car loan from Axis
bank and the tenure to close the account is between 24-36 months. If Tushar has paid between
12EMIs – 17EMIs then he will get top-up loan 125% on the principal amount (total loan – total
EMIs paid) and if he had paid 18+ EMIs ten he will get top-up loan 150% on the principle
amount. The table shows top-up loan you will get as per the Axis Bank criteria.
• Sr. No. Tenure Funding (125%) on Principal Amount Funding (150%) on Principal
Amount
• 1 24 – 36 Months 12 to 17 EMIs 18 & Plus EMIs
• 2 37 – 48 Months 15 to 17 EMIs 18 & Plus EMIs
• 3 49 – 60 Months 18 to 20 EMIs 21 & Plus EMIs
• 4 Greater Than 60 Months 21 to 25 EMIs 26 & Plus EMIs
• For the process 1% fees are applied. If we calculate the interest rate it is nearly 15%.
• Note: Principal Amount = Loan Amount – Total EMIs Paid.
• Also Read: Few Important Tips to Manage Car Loan

8. Related Link
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