Benefits of Opting for Home Loan Balance Transfer - Loan Trivia


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Wednesday 16 January 2019

Benefits of Opting for Home Loan Balance Transfer

Home loan balance transfer is a facility by which you can benefit from the lowering of the interest rates which happens from time to time. However, many times lenders are unable to pass on the benefits to the end user and as a result she/he is stuck with the old interest rates even after opting for a floating interest rate. In such cases a home loan balance transfer facility can be of immense help. If you do not know about it read on to find out.

Home Loan Balance Transfer

It is a feature which allows the borrower to transfer the remaining amount of loan to be transferred to another lender which is providing better features and lower interest rate. The new lender pays the balance principal amount which was extended by the original lender in the first place. As a result, the borrower pays the remainder of the loan to the new lender at lower monthly installments.

How Does it Benefit?

In order to understand whether a balance transfer scheme will benefit you or not you need to consider the costs involved in the entire process. Some of the costs involved are the pre-payment charges of the old lender, processing charges by the new lender, the stamp paper costs and the time required to complete the loan transfer.

It is not necessary that these are the only costs involved or that your lenders will surely charge you for these costs. You thus first need to check out the costs that will be incurred in the entire process by having a discussion with both lenders. This will help you in arriving at a conclusion as to whether it will worth it or not.

Read Also: Stop Paying High EMIs. Try a Home Loan Balance Transfer

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