Understanding the Home Loan Balance Transfer Process

Over time, lending markets evolve. Interest rates may decline, and financial institutions often introduce more borrower-friendly features. If you already have a Home Loan, you can benefit from these changes.  

A Home Loan balance transfer process allows you to transfer your outstanding loan to another lender offering more favourable terms. With the greater ease of Home Loan transfer available today, this option provides a practical way to optimise your finances without interrupting your homeownership journey. 

How to Transfer Home Loan to Another Lender – Step-by-Step Guide

Here’s how the balance transfer Home Loan procedure works with Bajaj Housing Finance: 

1. Submit your balance transfer application with us, alongside all essential documents. 
2. We assess your eligibility based on your profile and documents. 
3. Notify your current lender and let them know that you are transferring your loan.  
4. The current lender provides a No Objection Certificate (NOC) or consent letter once they accept your request. 
5. Share the NOC and foreclosure letter with us to verify the transfer details. 
6. Once the details are verified, your outstanding loan amount is settled, after which you may pay a nominal balance transfer fee.  
7. Your new loan account is transferred to us, and you will now start paying your EMIs as per the agreed terms.  

Documents Required for Home Loan Balance Transfer

To keep the process smooth, gather these documents*** required for a Home Loan Balance Transfer in advance: 

• KYC documents: Aadhaar Card, PAN Card or Form 60 (mandatory), Voter ID, Passport, or Driving Licence 
• Income proof: Salary slips or ITRs, depending on employment type 
• Property papers: Title deeds, sale agreement, approvals 
• Loan history: Recent statements, repayment records 
• NOC or foreclosure letter from your current lender 

***This list is indicative.  

When Should You Consider a Home Loan Transfer?

You should consider a Home Loan balance transfer: 

• If you're currently servicing a Home Loan at a high interest rate and better rates are within reach 
• If your current lender's service isn’t matching your expectations 
• When you're looking for a Top-up Loan while transferring 

Generally, the best time is early in the loan tenure, when a major portion of your EMI goes towards interest payment, so the savings from a lower rate have more impact. 

Mistakes to Avoid in the Transfer Process 

While the process is straightforward, small details can sometimes be overlooked. Here are seven mistakes you should be mindful of: 

1. Ignoring total interest paid – A slightly lower rate is good, but if it's for a much longer tenure, your overall interest may rise. Always check the total repayment, not just the EMI. 
2. Overlooking lender’s service – Don't pick a lender just for the low rate. Verify if they provide prompt service. 
3. Forgetting transfer charges – Factor in the balance transfer fee that you need to pay.  
4. Timing of the transfer – Waiting till the loan's last few years limits your potential savings. Early transfer makes more sense. 

Balance transfer makes sense when long-term savings outweigh associated costs. Whether it’s securing a lower interest rate, improving service quality, or opting for additional features like a Top-up Loan, the process can provide significant financial benefits when timed well.