Transfer Home Loan

Rate of interest for home loan borrowed at floating rate option keeps modifying. The rate is dependent on repo rate as per RBI policy and internal bank policies. Housing loan are for long tenure, and it is possible that the rate of interest might increase or decrease during loan duration. In both the scenario, borrower must be on alert. If rate increased by lending bank, then borrower should check whether any other lender providing home loan at lower interest rate. In case of decrease in interest rate, borrower must get the benefit of revised ROI. There might be possibility that lender might not extend the rate benefit to existing customer. In both the scenario, borrower must switch loan to the other bank / NBFC with lower interest offering. The process is termed as Balance transfer facility in banking terms.

Balance transfer helps borrower to save money with immediate effect. Transfer Home Loan is normally processed within weeks, if required documents submitted on time and with no discrepancy. Transferring existing home loan to new bank / NBFC is not a tedious task and helps the borrower save sufficient amount of money and time. Balance transfer provides option to reduce monthly EMI or loan tenure or both marginally.

Benefits of Balance Transfer

Reduces interest rate

Get lower interest rate benefit with immediate basis

Lowers monthly EMI

The monthly payment obligation reduces significantly

Money saved, is money earned

Amount of money saved is significant

Lowers the loan tenure

Pay same monthly EMI & reduce loan tenure, saves more on total interest payable

Easy process

Applying for balance transfer is easy, other lenders prefer balance transfer business as it’s low risk

Low operational cost

Most lenders don’t charge for loan closure or a charge nominal fee

Documents Required for Balance Transfer

  • Signed application form with recent photo
  • Basic KYC - ID Proof, address proof, PAN & others
  • Latest 1yr bank statement of ongoing EMI payments & income records
  • Statement of accounts of existing loan which needs to be transferred
  • Property documents - Photocopy at time of application & original later
  • Salaried - Company Id Card Copy, Salary Slip & Appointment letter
  • Self Employed – 3yrs IT returns, Past 2yrs P&L, GST / COI, AOA & MOA

Eligibility for Balance Transfer

  • Active home loan for transfer
  • Age between 21-65 years
  • No default in exiting loan payment tracks
  • Positive credit score
  • Job stability of 2 years for salaried
  • 3 years Business continuity for self-employed
  • Existing loan agreement minimum lock-period (if any) should be completed

Most lender prefer sourcing home loan balance transfer business from other banks. Loan transfers are considered as low risk portfolio. This is because the verifications required to source a new customer, is already done during initial loan disbursement. If the borrower is paying EMI on time and without any defaults, it is a preferred risk to be underwritten. Apply now for Balance transfer, by just filling the above form.

Home Loan Reference

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