Balance transfer of loan is the process where a customer transfers his outstanding principal amount to another bank or financial institute primarily for a better rate of interest and also better features. Almost every type of loan – auto, personal, home, education has a balance transfer facility and almost all banks have this facility.
Balance transfer reduces you interest rates and finally enables you to save on the interest you have to pay. Also, income levels of an individual are dynamic and what you currently earn maybe more than what you earned two years ago. Balance transfer is a great facility that lets you reexamine your debt, make changes to it and also tweak it according to your requirements.
A home loan balance transfer is also known as refinancing. Almost every lender offers a home loan balance transfer facility. If you have the required eligibility, you can switch your home loan and get a better deal as a borrower.
Your personal loan gets transferred to another person and now the new person is liable to repay the loan. Do note that in such a case, the eligibility of the other person will be taken into account and documents for the same needs to be provided.
The loan against property balance transfer facility allows borrowers to pay reduced EMIs by shifting the outstanding loan amount. Along with a flexible repayment tenor you can also avail of a sizeable top-up loan to fund any other needs.
Balance transfer of loan is the process where a customer transfers his outstanding principal amount to another bank or financial institute primarily for a better rate of interest and also better features.
Key takeaways. A transfer of mortgage is the reassignment of an existing mortgage, usually on a home, from the current holder to another person or entity. Not all mortgages can be transferred; if they are, the lender has the right to approve the person assuming the loan.
Loan balance transfer is a process by which borrowers can transfer the outstanding principal of their existing loan from one lender to another in order to benefit from the lower interest rate on the outstanding loan. A balance transfer provides the borrower the benefit of lower interest rates.
It is advisable to transfer a home loan when the outstanding loan amount is higher. Like any other EMI, a home loan EMI constitutes the principal amount and the interest amount. As the loan matures, the principal amount gradually gets paid, thus reducing the outstanding loan amount.
The loan transfer process is simple: you just need to close your loan account first with the existing lender and then pay a transfer fee to your new bank. Your new bank will pay off the existing loan and you have to pay to the new lender in equated monthly installments at a new rate of interest.
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