Home loan balance transfer is a feature that allows you to switch your lender. The question is why would you switch to a different lender, and how does a home loan balance transfer benefit you? The most obvious answer is, of course, to reduce your total interest outflow. A balance transfer gives you the opportunity to reduce your home loan interest rate and therefore, your EMI. Moreover, it also allows you to avail of a sizeable top-up loan at a relatively low rate of interest.
Read on to know more about the benefits of a home loan balance transfer.
What Is a Home Loan Balance Transfer?
A home loan balance transfer, as the name suggests, refers to the process of transferring the balance on your existing home loan to a new lender. Why would you switch? It could be for a lower home loan interest rate, better borrowing terms, or even a top-up loan for other financial needs. Whatever be the reason, home loan balance transfer
has emerged as a feasible solution for those with a home loan to reduce their EMIs and enhance affordability, or reduce their tenor become debt-free sooner.
A home loan is a long-term commitment that can run into up to 30 years, which means you will be tied to the given home loan EMI and lender for a long time to come. Thus, it is essential that you are happy with the terms and conditions applicable, be it in terms of other fees and charges or how transparent the processes and said charges are. Of course, the crucial factor in how easily you service the loan is your EMI.
An affordable EMI ensures comfortable repayment month on month without stretching your finances too thin. But more often than not, we believe we can shell out a set amount as EMI easily, but when the loan actually begins, the sum burdens your finances. The situation is further exacerbated by unexpected expenses.
All in all, it is in your best interest to stick with a lender that offers you the lowest possible interest rate with the most favourable borrowing terms. While there are a number of things one must check before finalizing on a new lender, the foremost one is the home loan interest rate. At present, the interest rate one can avail of can go as low as 6.75%* for salaried applicants.
The Home Loan Balance Transfer Process
Once you’ve decided to avail of a lender’s home loan balance transfer option, the process that follows is easy. The process is initiated once you’ve spoken with your new lender and agreed upon the terms and conditions of your loan transfer.
To formalise the balance transfer process, your new lender confirms that they now have custody of your home loan and pays the remaining loan amount on your behalf to your existing lender.
Upon receiving the outstanding loan amount from your new lender, your current lender hands over your property documents to them. These documents include a No Objection Certificate (NOC), stating that you do not owe any money to the current lender from here on. These can be delivered to your doorstep or be picked up from the lender’s branch closest to you – depending on what convenience options they have.
Following the transfer, you are expected to make the remaining EMI payments to your new lender till the end of your loan tenor. Another way to look at it is that effectively you’ve foreclosed an existing home loan and taken another one in its place with improved interest rates, shorter tenor, and better payback policies.
Features of a Home Loan Balance Transfer
The Balance Transfer (BT) of your home loan is comparable to the act of acquiring a new home loan. In other words, almost all of the features available on a new home loan apply to you. These commonly include:
- A sizeable top-up loan free of end-use restrictions
- No part-prepayment or foreclosure charges*
- A flexible repayment tenor of up to 20–30 years
- Customized repayment options
- Minimal documentation
There are a few things one must bear in mind before applying for a balance transfer. One of the key ones is that to be considered for a home loan balance transfer, it’s best to maintain a spotless credit repayment record. It helps increase your chances of availing of the balance transfer option, as well as negotiating for a lower interest rate.
Benefits of a Home Loan Balance Transfer with Bajaj Housing Finance Limited
There are a number of lenders you can consider while transferring your home loan. Of these, Bajaj Housing Finance Limited a premier HFC that offers attractive terms and a competitive rate of interest. Moreover, as a 100% subsidiary of Bajaj Finance Limited, it brings you the added reliability of dealing with a trusted lender
You are privy to a number of benefits when transferring your home loan to Bajaj Housing Finance Limited, some of which are listed below.
A Competitive Interest Rate of 6.75%*
The lender offers an attractive home loan interest rate
for all types of borrowers. Eligible salaried borrowers can avail of a home loan interest rate as low as 6.75%* p.a. The number is a record low can reduce your home loan EMI to as little as Rs.649/Lakh*.
A Top-up Loan of Rs.1 Cr* or Higher
Borrowers have the option to avail of a sizeable top-up loan when transferring their home loan balance to Bajaj Housing Finance Limited. Applicants can avail of a top-up loan of up to Rs1 Cr* or even higher, depending on their home loan eligibility.
A Flexible Repayment Tenor of up to 30 Years
With a reduced interest rate in the case of a home loan balance transfer, you have two options. You can either reduce your EMI, making repayment easier, or you can shorten the tenor, making repayment that much quicker. Whatever be your choice, you have the option to choose a tenor of up to 30 years, which ensures comfortable repayment in the long run.
You enjoy a balance transfer application like no other with Bajaj Housing Finance since there’s no need to visit the branch. The entire process is via phone calls or mail. It is only during the final stage, where you need to sign the loan agreement and complete the registration formalities that you need to be physically present. Here, their representatives bring the agreement to your doorstep for unmatched convenience.
Apart from these, you also benefit from:
- Customized repayment options suited to your specific needs
- Loans linked with external benchmarks, such as the repo rate
- Swift approval, processing, and disbursal with 5,000+ approved projects
Thorough research is a must before you finalize on a lender. Choose one that can offer you the maximum savings in the form of a lower interest rate, along with the best terms and conditions.
With Bajaj Housing Finance, salaried applicants can avail of an interest rate as low as 6.75%* p.a., with EMIs starting at Rs.649/Lakh*. In terms of the loan amount, you can avail of a sum of Rs.5 Cr* or even higher on the home loan and a sum of Rs.1 Cr* or even higher as the top-up loan, depending on your eligibility. Those who apply for home loan
now through their online application form also stand to get Amazon gift vouchers worth up to Rs.10,000* on disbursal.