A used car loan top-up is an additional loan amount that you can borrow over and above your existing used car loan. It is useful if you need extra funds for repairs, modifications, or personal expenses.
Key Features of a Used Car Loan Top-Up:
1. Eligibility:
- You must have an existing used car loan with good repayment history.
- Your loan-to-value (LTV) ratio should allow for additional borrowing.
- A good credit score (usually 650+) improves approval chances.
2. Loan Amount:
- Depends on the remaining balance and the car's current value.
- Some lenders allow a top-up up to 80-90% of the car’s market value.
3. Interest Rate:
- Slightly higher than the original loan, usually 9% to 18% per annum.
4. Tenure:
- Usually ranges from 1 to 7 years, but it may depend on the car's age
5. Processing Fees & Prepayment Charges:
- Processing Fee: 0.5% to 3% of the top-up amount.
- Prepayment Charges: 2% to 5% if you repay early (varies by lender).
6. Documents Required:
- Basic KYC documents (Aadhar, PAN, etc.)
- Income proof (salary slips, ITR, bank statements)
- Existing loan details
- Car insurance & updated RC (if required)
People also search for: