Eyeing a quick Home Loan balance transfer? Follow 4 vital steps and progress your application easily. Read on!
The fluctuations in the market conditions impact Home Loan interest rates. If you are a homebuyer who took out a Home Loan on a higher interest-rate and financially limping to make it work for you, you need to come up with other relevant funding alternatives.
One of the methods that many loan borrowers do is availing a Home Loan balance transfer facility, which is transferring their existing loan account to a new lender offering a better deal on interest.
Some borrowers also take out a personal loan to make partial prepayments on their housing loan.
People already having a personal loan go for a top up loan after switching their Home Loan. A top up loan is equipped with an extended tenor with a low-interest rate. You can utilize the money to pay off any other credits that you may have.
If you think that a Home Loan balance transfer will work for you, you will need to transfer the outstanding loan amount to a new lender. Many lenders provide a top up loan facility as well, giving you an access to extra funds at a reduced interest rate.
Let’s provide some vital steps to complete a hassle-free Home Loan balance transfer process.
Step 1: Finalize the right lender
With so much competition amongst loan financiers these days, almost all lenders provide a Home Loan balance transfer. Different lenders may be giving you different Home Loan interest rates.
If you are confused, you can do a comparative study of all lenders’ interest rates and then decide.
Once you have decided a lender, visit their website and use the Home Loan EMI calculator to know the exact EMI that you will now pay and then find out if it’s really a beneficial step.
Step 2: Assess your liability
Do end to end cost-benefit analyses before you settle for a Home Loan balance transfer! If you come across that your overall switching cost will be more than what you will save, don’t go for it. Along with the switching cost, you should also consider extra payments such as exit charges and processing fees.
Step 3: Credit approval
Your CIBIL score also needs to be in the pink of health along with a decent repayment record to be eligible for a Home Loan balance transfer. If you have maintained your CIBIL score by repaying all your debts on time, your new loan claim shall see no hurdles. You should also note that your new lender will review your current loan, how consistent you have been with the EMI payment and in your present job before approving your request.
Step 4: File for a No Objection Certificate
Once you submit your request for a Home Loan balance transfer, a statement containing your outstanding loan figure will be given by your current lender. You will then need to submit the document to your new lender; they would approve the loan amount to the existing lender and avail a closure of account letter. Your all documents with the old lender will then be submitted to the next one. Your all post-dated cheques or ECS will also invite a cancellation as well.
The Bottom Line
If you are willing to initiate a Home Loan balance transfer, you will need to follow the discussed steps. When you will follow the above steps, you will see your Home Loan balance transfer see a quick processing and approval from your new lender.