Along with keeping track of changing interest rates, borrowers are advised to note several other factors that are equally important when considering a home loan balance transfer. There are several points which you need to know about home loan balance transfer. Such as -

  1. Top-up loans
Borrowers opting for a home loan transfer are eligible for an additional credit known as a top up loan. This particular loan has no end-usage restriction and usually comes with a low rate of interest compared to personal loans.

  1. Lower rate of interest
Customers who have repaid a small fraction of their home loan can save a significant amount by availing a balance transfer with a new lender offering lower interest rates.

  1. Associated charges
HFCs can levy various charges and knowing them all can help you plan your finances. Some expenses that are commonly collected include:
    • Valuation fees.
    • Technical charges.
    • Foreclosure and pre-payment charges.
    • Penal interest.
    • Processing fees.
    • Stamp duty expenses.
    • Other charges as specified by the financial institution.


When to opt for a home loan transfer?


It is advisable to opt for a balance transfer during the initial years of repayment. At this time home loan transfer calculator can be useful too. As the interest component is high with EMIs during this time, borrowers will save the most.
Borrowers should also know that they can decrease EMIs and increase the tenor by making part pre-payments. This helps them to close the loan before the pre-determined tenor and save a significant amount in interest payments.