What is Home Loan Balance Transfer?
Home Loan Balance Transfer is a facility that allows you to reduce your EMI or interest rate
by transferring your outstanding home loan from one lender to another. This facility lets
you take advantage of lower interest rates available in the market.
So when should you take this facility? You should consider taking the home loan balance transfer facility when your existing lender is charging a higher interest rate in comparison to what other lenders are ready to offer you.
How to Calculate EMI on Home loan Balance Transfer?
The amount of money you can save will depend on the following factors:
1. Outstanding principal amount of Home loan.
2. Current EMI
3. Existing Outstanding Home Loan tenure.
4. Interest rate
5. Required term (months) to pay off the home loan balance transfer amount at the new interest rate :
|Particulars||Existing Loan||New Loan|
|Outstanding Balance||Rs. 8 Lakh||Rs. 8 lakh|
|Interest Rate (p.a)||8%||6.65%|
|Remaining Loan Tenure (months)||3 years||3 years|
|Monthly EMI Payable||Rs. 25,069||Rs. 24,610|
|Difference in EMI Payable||Rs. 459|
|Total Interest Payable||Rs. 1,02,487||Rs. 85,972|
|Wow Total Savings||Rs. 16,515|
Key Benefits of Home Loan loan Balance Transfer
The main benefit given by home loan balance transfer is interest savings. By taking a home loan balance transfer, you get the facility of the outstanding home loan to another lender who is offering lower interest rates. Of course, you must compare the costs and benefits before taking this facility.
Compare Home loan balance Transfer Interest Rates of All Major Banks
Home loan balance transfer is important because you can get low interest Rate.
|Bank Name||Floating Interest Rates||Per Lac Emi|
|SBI Home Loan||6.70% Onwards||Rs.645 Onwards|
|HDFC Home Loan||6.70% Onwards||Rs.645 Onwards||Apply Now|
|ICICI Bank Home Loan||6.70% Onwards||Rs.645 Onwards||Apply Now|
|Axis Bank||6.70% Onwards||Rs.645 Onwards||Apply Now|
|PNB Housing Finance||7.35% Onwards||Rs.689 Onwards||Apply Now|
|Bajaj Home Finance||6.70% Onwards||Rs.645 Onwards||Apply Now|
|IDFC First Bank||6.70% - 8.90%||Rs.645 - Rs.797||Apply Now|
|Indiabulls||8.99% onwards||Rs.804 Onwards||Apply Now|
|Tata Capital Home Finance||6.70% Onwards||Rs.645 Onwards||Apply Now|
|Equitas||9.50%||Rs.841 Onwards||Apply Now|
|Standard Chartered||6.99% onwards||Rs.665 onwards||Apply Now|
Key Points To Keep In Mind While Transferring Home Loan Balance Transfer.
Home Loan Balance Transfer Process
Take the following steps if you wish to avail Home loan balance transfer facility:
Check your existing home loan agreement and make sure it allows home loan balance transfer.
Shortlist a new bank that is ready to offer you a lower home loan interest rate with your comfort.
Compare the cost of home loan balance transfer with expected interest savings from home loan transfer.
Get a letter from existing lender along with documents specifying outstanding home loan balance.
Submit these documents along with all other required documents which required to the new lender.
Once your new lender approves the home loan, they will make payment towards your old home loan and close it.
Eligibility Criteria for Home Loan Balance Transfer
You need to meet certain key eligibility criteria to avail the Home loan balance transfer
facility. Eligibility for home loan balance transfer on home loans is mainly dependent on
borrower’s capacity to repay and his/her credit worthiness or credit health. The Home loan eligibility calculator can also
help potential borrowers know their eligibility to
transfer their outstanding home loan balance. Some common criteria that hold true for home
balance transfer of home loan to most banks include:
Fees and Charges of All Major Banks
The list of charges that you need to pay for a home loan are as follows:
- Application Charge/ Initial Processing fee – Non-refundable
- Processing fee
- Administrative fee
- Technical /Valuation Charge
- Legal /Title Charge
- Stamp Paper/Franking fee on the loan agreement
- Notary Charge
- Property Insurance Charge
- Cersai Charge
- Loan Insurance Charge
|Bank Name||Processing Fee||Prepayment Charges|
|SBI Home Loan||0.35% of loan amount + GST, Nil for Govt. Employees||Nil|
|HDFC Home Loan||Up to 1.25% of the loan amount or ₹ 3,000 whichever is higher, plus applicable taxes||Nil|
|ICICI Bank Home Loan||Flat Rs 3000 /- + AT||N.A.|
|Axis Bank||Up to 1% of the Loan amount subject to minimum of Rs.10,000/-||Nil|
|PNB Housing Finance||0.50% Or 10,000 + GST , whichever is higher.||Nil|
|Bajaj Home Finance||0.50% Or 10,000 + GST , whichever is higher.||Nil|
|IDFC First Bank||0.20% + 18% GST|
|IndiaBulls||0.50% to 1.00% + GST||Nil|
|Tata Capital Home Finance||0.50% to 1.00% + GST||Nil|
|Equitas||Up to 1% of the Loan amount subject to minimum of Rs.10,000/-||Nil|
|Standard Chartered||Rs.10000 + GST||Nil|
List of Documents for Home loan Balance Transfer
When you apply for home loan balance transfer, it's almost like applying for a new home loan. Therefore, you might have to submit all the documents that you may have submitted with the old lender. Take a look at some of the key documents required to apply for home loan balance transfer:
Completed appliction form for home loa Balance Transfer’
Applicant's latest passport-size photographs.
1. Address Proof
2. Age Proof
3. Income Proof
1. Birth certificate
2. 10th marksheet
3. Driving license
5. Voter ID
1. Aadhar Card
2. Voter ID
3. Driving license
1. Bank statements
2. salary slips
4. IT returns
Documents related to existing home loan including a letter of consent.
1. Sanction Letter
2. Statment of Account
3. List of Orginal Document