Home Loan Balance Transfer: There are many great options for those looking to buy their home this festive season. Many big banks have reduced interest rates on new home loans including balance transfer. If you also want to buy the home of your dreams, then this time can prove to be better for buying a home loan with low interest rate and convenient terms. Even if you have already taken a home loan, you do not need to worry about it. If your bank is charging high interest on the home loan and is not ready to give you any kind of discount, then you can transfer your balance. Banks have offered many such offers, through which you can switch from one bank to another.
What is Home Loan Balance Transfer
Sometimes you are not satisfied with your bank. If your bank is charging high interest on home loan or charging different types of charges at times, then you have the option of switching from one bank to another. In this situation, you can transfer your home loan. People usually do this for a low interest rate. The low interest rate also lowers your EMI. There are many other benefits of home loan balance transfer, which we will tell you further.
You will get best offer in these banks
In the festive season, a kind of competition is going on between the big private and public sector banks to provide loans at low interest rates to the customers. Many banks have waived processing fees to woo customers. Here we are telling you about such banks, where you can take a loan at low interest rate.
- State Bank of India (SBI) has announced to offer home loans at 6.7 per cent to borrowers whose credit score is above 800. With this decision of SBI, customers taking home loan will get savings of 45 basis. Apart from this, the bank has also completely waived the processing fee for the home loan borrowers.
- Bank of Baroda (BOB) has also reduced the home loan rate to 6.75 percent and along with it the processing fee has also been waived.
- HDFC Bank has also introduced a special home loan offer. The bank is offering home loans to customers at interest rates starting from 6.7 percent. This special scheme will be available till 31 October 2021 only.
- Kotak Mahindra Bank is offering home loan at the lowest interest rate since November last year. The bank reduced the home loan rates by 15 bps to 6.50 percent. This is a limited period offer, available for two months.
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Should you do Home Loan Balance Transfer?
The festive offers of banks are generally for new home loan borrowers. However, these offers are also available for borrowers who have already taken a loan. If you too have already taken a home loan and want to transfer your home loan balance this festive season for a lower rate of interest, then this is the right time for you. According to experts, if the new home loan offers are about 25-50 basis points cheaper than your current rate, then you can go for the home loan balance transfer option.
Banks are offering many great offers not only to new customers but also to those who transfer their home loan. Many banks, including SBI, BoB and PNB, have said that the customers making home loan transfer will also get the benefit of the initial interest rates of the home loan. This means that the interest rate for home loan transfer customers will be the same as for new customers. However, customers should keep in mind that the interest rate applicable to you will depend on your credit score. That is, the better your credit score, the easier it will be for you to get a loan.
Good news for HDFC Bank customers, discounts on car and personal loans, cashback on consumer goods, you can avail benefits like this
These are the benefits of home loan balance transfer
- You can take advantage of lower interest rates during the festive season through home loan balance transfer. This reduces your EMI. Apart from this, you also get the option to extend your repayment period.
- When you transfer your loan, you can also avail top-up benefits. There is generally no restriction on the use of the amount. You can use it for any expense. However, it will depend on the terms and conditions of the concerned bank.
- You also get to know the convenience of prepayment or foreclosure with home loan balance transfer. This makes repayment easier.
- You also get the facility of loan restructuring during home loan balance transfer. This means that you can increase or decrease the repayment tenure and EMI depending on your repayment capacity.
- Most of the banks have gone digital nowadays. Almost all the banks and financial institutions offer the option of online application to the customers. You should get all the details, including top-up amount, flexible repayment tenure, door-step service, foreclosure charges, before making a home loan balance transfer.
These documents will be needed
If you want to transfer home loan balance then you may need these documents for this – KYC documents like identity proof and address proof, financial statement of last two years of his business to self-employed applicant, business continuity for five years The salaried applicant will have to provide the current salary slip and bank account statement of the last 6 months.