Increase credit – possible at any time?

If you are planning major purchases, you often finance them with a loan. In some cases, however, it may happen that after taking out the loan you realize that the loan amount is not sufficient for the project. This may be the case, for example, in the event of unexpected costs during a renovation project. At this moment, many borrowers think about increasing the loan. We clarify in this article whether a loan increase is possible at any time and what should be considered in the process.

What does a credit increase mean??

If a loan is to be increased, this means that the existing loan amount is increased. This possibility can be used for very different reasons, for example, for the following situations:

  • Necessary repairs in the household or on the car
  • New purchase of large electronic appliances, such as a washing machine or refrigerator
  • Necessary purchases for equipment in case of family offspring
  • Unexpected cost increases for renovations or alterations as well as extensions to the house
  • Other unexpected expenses that cannot be covered by income

What are the requirements for an increase in credit must be met?

Just as with the granting of a loan, certain conditions must also be met for the increase of a loan. Only in this way can the lending bank be sure of recovering the money it has lent. The requirements are:

  1. Positive creditworthiness must be proven by means of a SCHUFA query.
  2. The income must be sufficient to be able to service the loan installment in addition to the living expenses.
  3. The debt must not be too high.
  4. Previous loan installments must always have been paid properly.
  5. A registered place of residence in germany must be available.
  6. The income situation will not deteriorate in the future.

When can a loan be topped up?

In principle, it is possible to increase an existing personal loan at any time. However, many banks have special regulations that must be observed in this regard. Some lenders stipulate in their general terms and conditions that a certain period of time must pass after a loan has been taken out before it can be topped up. In many cases, this period is six months after the first loan disbursement. This procedure has the following background: if, for example, you want to increase the loan amount only three weeks after taking out the loan, the bank sees this as a sign that you cannot calculate properly with the money. On the other hand, after such a short time, no repayment installment has probably been paid, so the bank cannot be sure that it will get its money back as agreed. The lock-up period for a credit increase, as it is common with many banks, serves to prove your reliability.

How often can a loan be topped up?

There is no general rule for this either. In principle, you can increase your existing loan an unlimited number of times. The prerequisite for this is always that the above-mentioned points are fulfilled and, above all, that the household income allows for a further burden from the new credit installment.

What does a credit increase cost??

The cost of financing is always made up of the interest incurred and any additional fees. According to a ruling by the dusseldorf higher regional court (27.11.2014, az. I-6 U 75/14), no additional fees may be charged for increasing an existing loan. Exceptions to this rule are allowed only as follows:

  • When the collateral required for the loan is re-evaluated
  • If, in the case of a mortgage loan, the value of the property needs to be reassessed
  • If a further entry in the land register is required for a real estate loan
  • If other products are taken out at the same time as the loan is increased, for example residual debt insurance

Also, the interest rates for the increase of a loan can change. If an existing loan is increased, the agreed interest rate remains for the already existing loan amount. The current interest rate is used as a basis for the amount of the increase. Overall, therefore, a loan with a mixed interest rate is created. you already have an existing loan of 12.000 €, which you can increase by a further 3.000 € want to increase. For the already existing credit amount, an interest rate of 5.0 % p.A. Agreed. In times of low interest rates, the bank currently charges, for example, only 3.0 % p.A. Interest on the top-up amount. Your new blended interest rate for the total loan amount of 15.000 € is therefore made up as follows:
((5.0 % x 4) + (3.0 % x 1)) / 5 = 4.6 % p.A.

Secure a more favorable interest rate by rescheduling

Instead of increasing a loan, you can of course take out a new loan and thus reschedule the old loan. In this way, you may be able to secure better interest rates on the total loan amount than would be possible with the calculation of a blended interest rate. This can save several hundred or thousand euros. Of course, this only makes sense if the current interest rate offered is lower than at the time the existing loan was taken out.

Advantages and disadvantages

Both increasing an existing loan and taking out a new higher loan to pay off the old loan offer their advantages and disadvantages:


Credit extension new borrowing
advantages – the bank already knows you from your previous payment history
-less documentation is required
-a large installment loan is more positive for the schufa than several small loans
– it may be possible to secure better conditions
– new customers often get better conditions than existing customers
disadvantages – there may be, compared to the new borrowing, an unfavorable mixed interest rate. – the bank does not know you
– all the documents and checks of a normal loan are necessary


Conclusion to the credit increase

A credit increase is basically possible at any time. In practice, however, many lending banks impose appropriate lock-up periods after a loan is taken out in order to check the reliability of the borrower. If the reliability is already proven and creditworthiness and income are correct, a credit increase can also be carried out several times.

If the increase of an existing installment loan is rejected, you can look for a new loan at other banks. If another provider offers a better interest rate than your current lender, it makes sense to reschedule the entire loan to save costs. Basically, however, you should ask yourself the following questions before taking out or increasing a loan:

  1. Do I really need the money?
  2. Can I manage the monthly installment over the entire term of the loan?

Especially for the amount of the repayment installment, you should include a corresponding buffer for unforeseen events in your own finances. This way you can be sure that the loan installment will not endanger your existence. If the loan installment can no longer be paid at some point, further costs quickly arise due to dunning and collection procedures. In addition, your credit rating deteriorates dramatically, which greatly reduces the chance of loans in the future.