PERSONAL LOANS

How do I top up an existing loan?

If you need extra funds for additional purchases or investments, you can top up your loan during the repayment term. Comparis explains how it works.

02.05.2023

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1.When can I increase my credit?
2.How does increasing a loan work?
3.What is checked when topping up or refinancing a loan?
4.What documents do I need to increase my loan?
5.Topping up, refinancing or parallel loans?
6.Calculate maximum loan amount

1. When can I increase my credit?

In theory, you can increase or top up your loan at any time, providing your personal financial circumstances allow it. It is possible to have multiple loans with one or multiple lenders at the same time, and also take out another loan to access additional funds.

2. How does increasing a loan work?

The process for applying for a second loan is the same as for the first loan, except the existing loan is included in your budget as an expense. The new lender will also check your payment history for the first loan. This is reported to the Central Office for Credit Information (ZEK) – whether it is good or bad.

If your record states that your payments have been regular and on time, this may have a correspondingly positive effect on the conditions of the new loan. If your record states that your payments have been late, however, this has a negative effect on your chances of obtaining a new loan and the conditions offered. Irrespective of whether you are topping up or refinancing a loan with an existing or new lender, the process always involves a credit capacity check as legally required by the Consumer Credit Act, a review of your credit standing and the preparation of a detailed budget.

Key points

Your payment practices during the term of your loan are visible to other lenders. This means that:

  • if you have good payment habits, i.e. you make regular payments, this improves your chances of topping up your loan and being offered better conditions.

  • Any delays to your payments have a negative effect on your creditworthiness and therefore on any future loan applications.

3. What is checked when topping up or refinancing a loan?

Your situation will be reassessed at the time of refinancing or topping up a loan. This means that all changes to your profile play a role. For example your income may have increased, you might now have been employed by the same employer for a long time, or you have been the holder of a B residence card for several years. These and many other factors affect your chances of getting a loan.

However, if your situation deteriorates during the term of your first loan or if you have negative payment experiences, you will receive worse conditions or possibly no approval for a new loan application. These negative payment experiences do not necessarily have to be related to the first loan.

4. What documents do I need to increase my loan?

A loan increase is a normal loan application. The following documents are required:

  • Official identity document such as ID card, passport or driving licence, or residence permit if you are not a Swiss citizen

  • Copy of your last three payslips (in the case of an indefinite employment relationship)

  • Copy of your loan agreement

  • In many cases, final settlement of the existing contract (outstanding balance)

Depending on your individual profile (e.g. marital status, outgoings, existing agreements), other documents may be required for the credit check. This varies from one lender to another.

You can find more information about the requirements here: Requirements for loans in Switzerland.

5. Topping up, refinancing or parallel loans?

Topping up a loan often involves closing your existing loan. This means that the outstanding amount is included in the new loan agreement and the old agreement is paid off in full at the same time. If your personal circumstances have improved, this can mean more attractive conditions. In addition, higher amounts generally attract lower interest rates, which is a further benefit of refinancing.

Is there a chance that the interest rate for the new loan will be higher? Then it may be better to leave the outstanding loan and only conclude a new contract for the additional amount. It is not usually possible to make sweeping statements about these matters. The right solution depends heavily on your initial situation, your credit history and the value of the outstanding and newly requested loans. 

Keep in mind that increasing the amount has a negative impact on your credit profile, similar to frequent enquiries.

6. Calculate maximum loan amount

You can use our credit limit calculator to obtain a rough idea of how much you will be able to borrow. The calculator uses the same software as the banks and is based on the requirements of the Consumer Credit Act. Bear in mind that lenders' credit limit calculations are much more detailed.

Calculate maximum loan amount

Brokers such as Credaris are on hand to answer all your questions about topping up or refinancing a loan. They can help explore your options and, if you wish, support you in finding the right loan for you.

The loan experts at Credaris can review your request for a loan increase and compare the products of different Swiss credit institutions to find a solution that fits your needs. This increases your chances of being able to top up your loan under fair conditions.

No-obligation loan enquiries

This article was first published on 04.03.2015

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Approval of a loan is forbidden by law if it would lead to over-indebtedness (Art. 3 UWG).