Easiest Way to Get A Home Loan Balance Transfer

The longest term loans for home loans have the longest repayment terms. You will have to repay it over time and use a large portion of your income. The interest rates charged for the same home should be considered when choosing your home. This is because the interest portion of your home loan EMI is more than 50%. When you calculate the interest rate for the entire loan tenure, the interest component will be almost equal to the principal component.

The home loan rates are currently at an all-time low. This is the perfect time to get a home loan deal that suits your needs. Home loan buyers who have previously purchased their home with a home loan may feel that they are getting a more expensive deal because they had their loan approved at higher interest rates. They can still get low-interest rates deals by transferring their existing home loan balance.

Current interest rates for home loans are at 6.95%, with a minimum EMI of Rs 655 per thousand. This will be tempting to exist home loan borrowers. You will want to transfer your loan to the lower rates.

The benefit of a home loan balance transfer can be accessed in the first 4 to 5 years. The EMI for a loan home consists of the highest interest component during the initial years.

Before you transfer the balance, it is important to analyze all savings and costs associated with the loan transfer.

Calculating the total cost of transfer to determine if it’s worth it

There are many costs associated with transferring your home loan. These include application fees, processing fees, prepayment fees and transfer fees for some lenders. Before you decide to transfer your loan, it is important to calculate your savings and do the calculations. Although a lower interest rate might seem appealing, it is important to determine if it is beneficial for you based on the money saved. Calculate the total cost to borrow in both cases, including prepayments and new processing fees. If you can save a substantial amount, even after all charges are paid, go for the transfer.

Eligibility Criteria for a Home Loan Balance Transfer

  • You must have an existing home loan with another lender to be eligible for a balance transfer.
  • Lenders might also require applicants to have served a minimum of 12 EMI’s on an existing loan/server during the lock-in period before transferring a balance. This condition may vary from lender to lender.
  • The applicant must not have defaulted on the payment of EMIs for existing loans.
  • Transfer of a home loan balance to a property that has been transferred but not registered is not possible for most lenders.

How to transfer your loan to another bank?

  1. Calculate your total borrowing costs by comparing your current rate to your one.
  2. Calculate the pre-closure cost.
  3. Compare rates and terms to find the best bank or lender for you.
  4. If you don’t have the list, get it. Also, get a foreclosure letter and a NOC certificate.
  5. You can apply for a home loan at a different bank.
  6. If you are happy with the terms, get the approval letter signed along with the new loan agreement.
  7. You can get disbursement by cheque/demand draft at the bank, and you can also deposit it to your existing lender.
  8. Please send the original lender the property documents and get them to the bank.

 

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