Many a time, customers cannot handle the high interest rates while they are repaying the loan. They cannot manage the monthly expense with the high EMI. In such situations, they can opt for a Home Loan Balance Transfer. This allows the customer to transfer the balance to another lender offering lower interest rates. This is also ideal in cases where the current financial institution decides to shift from fixed loan interest to a variable one. Here are some advantages of a home loan balance transfer.
1. Reduced Home Loan Interest Rates
The biggest advantage of a Home Loan Balance Transfer is that it brings down the home loan rates, thus allowing customers to seize up their savings as well.
2. Better Repayment Conditions
Some lenders might offer better repayment conditions. In such cases, it is better to opt for a Home Loan Balance Transfer.
3. Top-up Loans
Lenders often offer top up loans worth Rs.50 Lakh when customers opt for Home Loan Balance Transfer. These top up loan comes at an extended tenor and lower rate.
These are the major advantages of a home loan balance transfer. It is the best way to tackle the hike in interest rates. This enables customers to pay lower EMIs and enjoy better customer services. Lenders charge a processing fee of 1 percent of the remaining loan principal mount when customers want to opt for balance transfer of their home loan. If the processing fee is more than the savings, customers should not continue with it.