Home loans are very common in India. In fact, a vast majority of the current Indian homeowners have availed of a home loan to buy their homes. As a result, every single loan provider offers home loans at attractive rates of interest. However, the home loan interest rate can differ between the different lenders. This is why you need to ensure the loan you are repaying is indeed the cheapest. If you feel you are paying a much higher rate, look for a balance transfer. The home loan balance transfer is a facility that is available and you must use it without any worries.
Understanding a home loan balance transfer
So, what exactly is a home loan balance transfer? It is nothing but shifting your existing loan from one lender to the other. This is mainly done when a new lender offers a better home loan interest rate. If the rate is lower, the overall financial burden of the borrower reduces and he ends up with a profitable deal.
Process of a home loan balance transfer
Here are the steps to follow when looking to get your home loan transferred from one lender to the other:
- Step #1: Compare –
Begin by taking a good, hard look at the loan you have currently. What is the current home loan interest rate that you are paying? Let us assume you are paying the loan back at a rate of 9.02%. You should then compare the home loan interest rates of the other banks to see who has a lower rate on offer. You may find a bank or NBFC who has a rate of 8.9%. If this is the case, make a transfer right away and save lots of money. When comparing, also keep an eye out for the processing fee. Some lenders charge a very steep processing fee. Avoid such lenders to keep the overall cost of the loan low.
- Step #2: Make a fresh application –
Once you find your new lender, make a fresh application and submit the required documents. The bank will then pay the existing lender the remaining balance and the home loan will be transferred. You will have to pay your EMIs henceforth to the new lender who has a lower home loan interest rate.
- Step #3: Get the documents –
The new lender will issue a fresh set of home loan documents to you. Collect and store the documents carefully.
Read:- What is Home Loan Calculator and How it Works
- Step #4: Start paying the EMIs –
And finally, pay the EMIs on time and in full. You will have to repay the loan, even while the home loan interest rate is lower. Pay the dues on time and clear your home loan with ease.
Benefits of a home loan balance transfer
From getting a better home loan interest rate to getting a lower processing fee, you get several benefits when you get a loan transfer done. So, go ahead and transfer your loan if you find a lender who offers a better home loan interest rate. Follow the steps mentioned above and your job will be done quite fast. Learn more with Time Business News