While availing of a Home Loan, homebuyers often look for lenders who understand their financial standing and offer customised loans basis their eligibility. For borrowers who are looking to manage their Home Loan efficiently, applying for a Home Loan Balance Transfer can be a strategic move.
Even those servicing a housing loan try to avail of competitive deals by negotiating favourable terms with their current lender or opting for a Home Loan Balance Transfer with another lender who offers them better interest rates. However, like every other loan, there are several pros and cons of Home Loan Balance Transfer that necessitate a wider understanding of some of its key elements.
Pros of Home Loan Balance Transfer
Detailed below are some of the benefits of a Home Loan Balance Transfer:
Reduced Interest Rates
One of the chief reasons for switching lenders is to avail the benefits of a lower Home Loan interest rate. Loan rates single-handedly influence the cost of your Home Loan. Therefore, securing a modest interest can considerably cut down your debt, in addition to fetching you suitable terms and services.
Also Read: Five Ways to Reduce Your Home Loan Burden
Enhanced Credit Score
A balance transfer can aid in improving your credit score. Maintaining a high credit score is vital to receiving attractive interest rates and credit deals.
Cost-Effective Loans
The primary objective of a loan shift is to save funds. Reduced interest rates make it easier to repay the loan. It enables you to budget proactively as well as plan for pre-payments to decrease the interest outgo and close the loan sooner.
Cons of Home Loan Balance Transfer
Now let us consider the various disadvantages of a Home Loan Balance Transfer:
Tricky Terms and Conditions
Even if you snap up the best transfer deal in the market, go through the terms and conditions carefully to avoid any unforeseen financial quandary in the future.
Loan Approval Process
When you apply for a balance transfer, it is very similar to undergoing the Home Loan approval process once again as it involves legal verification of the documents, credit appraisal and so on. A loan switch requires you to fulfil the lender’s eligibility criteria and there are possibilities of rejection if you don’t measure up to these parameters.
Read Also: Loan Disbursement and Sanctioning Process
Additional Fees and Charges
There are several charges and fees associated with a balance transfer. If one isn’t cautious, these costs may add up to make your transfer option an expensive proposition. So, compute these charges while calculating the costs of a loan shift to assess its viability.
What is a Home Loan Transfer to Another Person?
Just as lenders allow borrowers to switch their existing Home Loans to another lender based on specific terms and conditions, they also provide a facility for transferring a loan balance from one individual to another. While servicing an ongoing Home Loan, if you wish to sell off the property against which you have secured the loan, and a buyer seeks to avail of a Home Loan from the same lender, an internal balance transfer takes place from one person to another.
Here, the applicants change while the lender remains the same. The owner sells the property to the buyer with a subsequent transfer of ownership rights; and closes the loan with the money obtained through the sale.
How to Transfer a Home Loan to Another Person?
A Home Loan transfer has certain pre-conditions. Usually, while transferring a Home Loan to another buyer, borrowers have to follow this process:
- Firstly, the existing loan borrower must furnish a letter requesting loan foreclosure against the sale of the property.
- If another individual wants to purchase it, they may apply for a housing loan with a duly filled application form and the applicable processing fees.
- The buyer has to submit KYC documents and income proof to the lender. The property will undergo a legal and technical evaluation to determine its current value since the process involves ownership transfer. A No Objection Certificate from the developer or authority is also necessary in this case.
- The lender issues a cheque to the seller/owner after the ongoing Home Loan is closed with the proceeds of the newly sanctioned loan.
- Then, the seller hands over copies of the property-related documents to the buyer, while the original ones remain in the lender’s custody until complete loan repayment.
To Conclude
A balance transfer can reap maximum benefits in the initial years of the loan tenor provided you get the ideal tenor and interest rate. Thus, if you are given a longer tenor with lower EMIs, your interest payouts will increase considerably, raising the credit cost. Moreover, if you have already repaid a large chunk of your EMIs, it is best to continue with the current lender, as a loan switch may not fetch you any gains at this stage.
It is always advisable to negotiate the rates with your present lender first and try to avail of a better deal. This will save you ample time and energy. But if you cannot come to an agreement, a loan shift could be the best alternative. Remember, you may have to bear a penalty for seeking a transfer. Some lenders waive off this amount while others might impose a partial waiver. Also, a Home Loan Balance Transfer Calculator enables you to gauge and compare the various loan transfer schemes in the market so that you can select the one per your preference.
DISCLAIMER:
While care is taken to update the information, products, and services included in or available on our website and related platforms/websites, there may be inadvertent errors or delays in updating the information. The material contained in this website and on associated web pages, is for reference and general information purposes, and the details mentioned in the respective product/service document shall prevail in case of any inconsistency. Users should seek professional advice before acting on the basis of the information contained herein. Please take an informed decision with respect to any product or service after going through the relevant product/service document and applicable terms and conditions. Neither Bajaj Housing Finance Limited nor any of its agents/associates/affiliates shall be liable for any act or omission of the Users relying on the information contained on this website and on associated web pages. In case any inconsistencies are observed, please click on contact information.
Trending Articles

home+loan Home Loan
[N][T][T][N][T]
Can I Take a Home Loan and a Personal Loan Together?2024-01-17 | 4 min

home+loan Home Loan
[N][T][T]Stamp[S]Paper:[S]Use[S]and[S]Validity[N][T]
Stamp Paper: Use and Validity2025-01-30 | 2 min

home+loan Home Loan
[N][T][T][N][T]
Inches to Centimetre Conversion: Key Insights for Home Construction2025-01-22 | 2 min

home+loan Home Loan
[N][T][T][N][T]
A Guide to Applying for DTCP Approval for Patta Land Online2025-01-13 | 6 min

home+loan Home Loan
[N][T][T][N][T]
Cooperative Housing Societies: Objectives, Types, and Advantages2025-01-13 | 3 min

home+loan Home Loan
[N][T][T][N][T]
Why Notary Fees Vary: Key Factors Explained2025-01-31 | 2 min

home+loan Home Loan
[N][T][T][N][T]
Understanding Bigha in India: Convert 1 Bigha to Square Feet, Acres, and Hectares2025-01-31 | 2 min

home+loan Home Loan
[N][T][T][N][T]
PMAY Urban Mobile Application: Everything You Need to Know2025-01-20 | 2 min

home+loan Home Loan
[N][T][T][N][T]
Key Comparison Between PMAY Gramin and PMAY Urban 2.02025-01-20 | 4 min

home+loan Home Loan
[N][T][T][N][T]
Eligibility Guide for PMAY Urban 2.0: Credit Linked Subsidy Scheme (CLSS) Explained2025-01-13 | 2 min

home+loan Home Loan
[N][T][T][N][T]
PMAY Urban 2.0: Guidelines for Affordable Housing in India2025-01-29 | 2 min

home+loan Home Loan
[N][T][T][N][T]
How to Convert Hectare to Bigha?2025-01-29 | 2 min

home+loan Home Loan
[N][T][T][N][T]
Gift Deeds: A Comprehensive Guide to Registration and Documentation2025-01-29 | 2 min

home+loan Home Loan
[N][T][T][N][T]
What is LOD in Home Loans? Meaning, Importance, and Benefits2025-01-10 | 2 min

home+loan Home Loan
[N][T][T][N][T]
Understanding APF Number and Its Role in Home Loan Applications2025-01-07 | 2 min

home+loan Home Loan
[N][T][T][N][T]
What is MODT in Home Loans & Importance2025-01-27 | 5 min

home+loan Home Loan
[N][T][T][N][T]
What is a Non-Encumbrance Certificate (NEC): Its Meaning and Importance2025-01-27 | 2 min

home+loan Home Loan
[N][T][T][N][T]
Khasra Number Explained: How to Find It2025-01-03 | 2 min

home+loan Home Loan
[N][T][T][N][T]
Home Loans and CIBIL Scores: The Key to Approval2025-01-03 | 2 min

home+loan Home Loan
[N][T][T][N][T]
DLC Rate in Home Loans: Everything You Should Know2025-01-17 | 2 min

home+loan Home Loan
[N][T][T][N][T]
Completion Certificate: Why It Matters for Property Buyers2025-01-17 | 2 min

home+loan Home Loan
[N][T][T][N][T]
Stamp Duty in Bihar: Key Documents and Fees Simplified2025-01-16 | 2 min

home+loan Home Loan
[N][T][T][N][T]
Pre-EMI or Full EMI: Understanding Home Loan Repayment Options2025-01-16 |

home+loan Home Loan
[N][T][T][N][T]
How to Check Your Bajaj Housing Finance Home Loan Status2023-12-13 | 4 Min

[N][T][T][N][T]
Everything You Need to Know About Home Loan Part-Prepayment2024-12-18 | 5 min

loan+against+property Loan Against Property
[N][T][T][N][T]
A Guide to Calculate Loan Against Property EMI2025-01-08 | 2 min

[N][T][T][N][T]
Loan Against a Shop- Commercial Property Loans2024-12-18 | 2 min

loan+against+property Loan Against Property
[N][T][T][N][T]
Understanding the Types of Collateral Properties2024-12-26 | 4 min

loan+against+property Loan Against Property
[N][T][T][N][T]
Transform Your Space with a Loan Against Property for Home Renovation2024-12-26 | 2 min

loan+against+property Loan Against Property
[N][T][T][N][T]
Things You Need to Know Before Applying for a Loan Against Property2024-12-02 | 3 min

home+loan Home Loan
[N][T][T][N][T]
Features and Benefits of Home Loans: A Complete Guide2024-12-27 | 3 min

cibil Cibil
[N][T][T][N][T]
Loan Rejection Impact on CIBIL Score2024-12-23 | 3 min

loan+against+property Loan Against Property
[N][T][T][N][T]
Understanding All the Charges on Your Loan Against Property2024-12-27 | 2 min

loan+against+property Loan Against Property
[N][T][T][N][T]
Choose the Right Lender for a Loan Against Property2024-12-23 | 3 min

[N][T][T][N][T]
Top 3 Reasons to Buy a Home Before You Reach 302024-12-11 | 3 min

home+loan Home Loan
[N][T][T][N][T]
How to Connect with Bajaj Housing Customer Care2023-06-27 | 5 Min

loan+against+property Loan Against Property
[N][T][T][N][T]
How Can a Loan Against Property Help You Expand Your Business?2024-12-02 | 5 min

home+loan Home Loan
[N][T][T][N][T]
3 Smart Tips for Refinancing Your Home Loan2024-12-03 | 3 min

loan+against+property Loan Against Property
[N][T][T][N][T]
Benefits of Loan Against Property EMI Calculator2024-12-03 | 3 min

[N][T][T][N][T]
How to Choose the Right Home Loan2024-11-26 | 4 min

[N][T][T][N][T]
Common Charges Associated with a Home Loan2026-01-02 | 5 min

home+loan Home Loan
[N][T][T][N][T]
Top 5 Home Loan Benefits for First-time Woman Buyers2024-05-14 | 5 min

home+loan Home Loan
[N][T][T][N][T]
Hybrid Flexi Loan vs. Personal Loan: Which One is Better?2024-01-24 | 3 min

[N][T][T][N][T]
3 Ways to Reduce Your EMIs with a Home Loan Balance Transfer2024-05-08 | 5 min

cibil Cibil
[N][T][T][N][T]
What Does Your Credit Score Tell About You?2024-06-11 | 5 min

home+loan Home Loan
[N][T][T][N][T]
All You Should Know About Home Loan Disbursement and Sanctioning Process2024-03-19 | 3 Min

home+loan Home Loan
[N][T][T][N][T]
What Is a Pre-Approved Home Loan and How Should You Get It Done?2024-03-12 | 5 min

loan+against+property Loan Against Property
[N][T][T][N][T]
Top Benefits of a Loan Against Property Over Collateral-Free Loans2024-01-09 | 4 min

home+loan Home Loan
[N][T][T][N][T]
Home Loan vs Loan Against Property: A Complete Comparison2023-11-29 | 4 min

home+loan Home Loan
[N][T][T][N][T]
Difference Between Home Loan and Personal Loan: Which is better?2024-03-04 | 4 min

home+loan Home Loan
[N][T][T][N][T]
Why Should You Choose a Balance Transfer on Your Home Loan?2023-02-01 | 4 min

cibil Cibil
[N][T][T][N][T]
How Does Being A Loan Guarantor Affect Your Credit Score?2024-03-13 | 4 min

cibil Cibil
[N][T][T][N][T]
How Business Loans Affect Your CIBIL Score & How to Improve the Same2024-03-13 | 6 min

cibil Cibil
[N][T][T][N][T]
How Can Customers Check Their Credit History?2023-06-14 | 3 min

cibil Cibil
[N][T][T][N][T]
How Can Your CIBIL Score Help in Negotiating Better Home Loan Deals2023-05-18 | 4 min

cibil Cibil
[N][T][T][N][T]
Here Is How a Bounced Cheque Can Affect Your CIBIL Score2023-06-06 | 5 min

cibil Cibil
[N][T][T][N][T]
What is Credit Mix and How to Boost Your Credit Score?2023-03-27 | 7 min

home+loan Home Loan
[N][T][T][N][T]
How Can Your Credit Score Impact Your Home Loan Interest Rate?2024-02-13 | 6 min

cibil Cibil
[N][T][T][N][T]
How Does Your Digital Footprint Affect Your CIBIL Score?2024-03-20 | 5 min

home+loan Home Loan
[N][T][T][N][T]
How Digital Platforms Are Revolutionising the Face of Housing Finance2023-12-21 | 7 min

cibil Cibil
[N][T][T][N][T]
How Does Missing One Payment Affect Your CIBIL Score?2024-05-15 | 4 min

loan+against+property Loan Against Property
[N][T][T][N][T]
5 Important Reasons to Opt for a Loan Against Property to Start Your Own Business2023-02-10 | 2 min

home+loan Home Loan
[N][T][T][N][T]
Differences Between Fixed and Floating Interest Rates2024-05-15 | 2 min

home+loan Home Loan
[N][T][T][N][T]
How to Get a Better Interest Rate on Your Home Loan2024-01-04 | 5 min

[N][T][T][N][T]
Everything You Need to Know About Home Loan Tax Benefits2024-04-23 | 6 min

home+loan Home Loan
[N][T][T][N][T]
A Complete Guide for Home Loan Insurance2023-04-03 | 4 min

[N][T][T][N][T]
Loan Against Property for Doctors: An Essential Checklist2024-05-07 | 2 min

home+loan Home Loan
[N][T][T][N][T]
Understanding Loan-to-Value Ratio (LTV) and its Calculation2023-11-28 | 4 Min

tax Tax
[N][T][T][N][T]
Everything You Should Know About Tax Savings When Taking a Home Loan2023-01-09 | 5 min

cibil Cibil
[N][T][T][N][T]
How to Check, Calculate, and Improve CIBIL Score?2024-01-11 | 2 min

home+loan Home Loan
[N][T][T][N][T]
Everything You Need to Know About Top-up Loans on a Home Loan2024-04-09 | 6 min

cibil Cibil
[N][T][T][N][T]
Everything You Should Know About Your CIBIL Score2024-02-09 | 7 min

home+loan Home Loan
[N][T][T][N][T]
What Factors Decide Your Home Loan Interest Rates?2024-05-29 | 6 min

cibil Cibil
[N][T][T][N][T]
What Factors Do Not Affect Credit Scores?2024-02-28 | 7 min

home+loan Home Loan
[N][T][T][N][T]
Factors Determining Your Home Loan Eligibility2024-03-13 | 4 min

cibil Cibil
[N][T][T][N][T]
How can I Remove Loan Inquiry from CIBIL Credit Report2024-01-22 | 5 min

cibil Cibil
[N][T][T][N][T]
Check CIBIL Score with PAN Card for Free, in 3 Steps2024-02-27 | 5 min

home+loan Home Loan
[N][T][T][N][T]
How to Pick the Best Home Loan Tenor that Suits Your Budget2023-06-29 | 5 min

home+loan Home Loan
[N][T][T][N][T]
Common Mistakes to Avoid When Applying for a Home Loan2023-12-04 | 2 min

home+loan Home Loan
[N][T][T][N][T]
Common Myths About Home Loans: All You Need to Know2024-04-08 | 5 min

cibil Cibil
[N][T][T][N][T]
10 Common Myths About CIBIL Score2024-03-27 | 4 min

home+loan Home Loan
[N][T][T][N][T]
7 Common Problems You May Face While Applying For Home Loan2024-01-18 | 7 min

tax Tax
[N][T][T][N][T]
Comparison Between New Tax Regime vs Old Tax Regime2024-04-10 | 5 min

cibil Cibil
[N][T][T][N][T]
A Helpful Guide to Understanding Your Credit Report2024-01-26 | 5 min

cibil Cibil
[N][T][T][N][T]
Introduction to Credit Information Bureau India Limited (CIBIL)2024-04-15 | 6 min

cibil Cibil
[N][T][T][N][T]
Difference Between Credit Score and CIBIL Score2024-02-15 | 5 min

home+loan Home Loan
[N][T][T][N][T]
What is the Difference Between Top-up Loan and Home Improvement Loan2023-01-11 | 5 min

tax Tax
[N][T][T][N][T]
Difference Between Old vs. New Tax Regime2024-08-22 | 5 min

home+loan Home Loan
[N][T][T][N][T]
6 Point Differentiation Between Home Loan Vs Home Construction Loan2023-02-15 | 6 min

cibil Cibil
[N][T][T][N][T]
Does a Name Change Affect Your Credit Score2024-01-07 | 4 min

cibil Cibil
[N][T][T][N][T]
Does Applying for Credit Affects One's CIBIL Score?2024-03-14 | 3 min

cibil Cibil
[N][T][T][N][T]
Does CIBIL Score Affect Loan Against Property Eligibility?2023-02-15 | 7 min

cibil Cibil
[N][T][T][N][T]
Will a Loan Settlement Ruin My CIBIL Score?2023-03-21 | 4 min

home+loan Home Loan
[N][T][T][N][T]
What is Foreclosing a Home Loan? These are Some of the Do’s and Don’ts2023-12-20 | 6 min

cibil Cibil
[N][T][T][N][T]
Easy Ways to Maintain a Good Business Credit Score2024-01-10 | 5 min

cibil Cibil
[N][T][T][N][T]
10 Effective Strategies for Boosting Your Credit Rating2023-03-24 | 6 min

loan+against+property Loan Against Property
[N][T][T][N][T]
What Are the Eligibility Criteria for Obtaining a Loan Against Property?2023-03-28 | 4 min

home+loan Home Loan
[N][T][T][N][T]
Benefits of Submitting a Digital Home Loan Application in Current Times2023-12-20 | 4 min

tax Tax
[N][T][T][N][T]
Top Benefits of Using an Online Income Tax Calculator2023-12-28 | 5 min

home+loan Home Loan
[N][T][T][N][T]
Best Credit Score for Home Loans & How to Improve Yours2023-08-31 | 6 min

home+loan Home Loan
[N][T][T][N][T]
Get Your Down Payment Funds Ready with These 5 Easy Steps2023-03-20 | 5 min

cibil Cibil
[N][T][T][N][T]
Boost Your Credit Score By Minding The Factors That Affect It2023-03-20 | 5 min

home+loan Home Loan
[N][T][T][N][T]
What Happens If Home Loan EMI Bounces? Know the Consequences2024-07-11 | 5 min

home+loan Home Loan
[N][T][T][N][T]
Would it be Possible for Me to Apply for a Second Mortgage?2024-05-22 | 3 min

cibil Cibil
[N][T][T][N][T]
How to Check Your CIBIL Score for Free and What to Do If There Are Errors in It2024-06-05 | 4 min

[N][T][T][N][T]
Checklist of Documents Required for Home Loan2024-02-07 | 5 min

cibil Cibil
[N][T][T][N][T]
CIBIL Score Charges & Services You Must Know2023-04-04 | 2 min

cibil Cibil
[N][T][T][N][T]
What to Know About CIBIL Score 2.02024-06-20 | 3 min

tax Tax
[N][T][T][N][T]
Can I Claim Home Loan Tax Benefits on an Under-Construction Property?2024-05-23 | 5 min

tax Tax
[N][T][T][N][T]
How to Claim Tax Benefits on Joint Home Loans2024-07-10 | 4 min

cibil Cibil
[N][T][T][N][T]
Some of the Common Credit Mistakes to Avoid2023-03-21 | 4 min

home+loan Home Loan
[N][T][T][N][T]
Advantages of Including a Co-Applicant on Your Home Loan2024-01-21 | 7 min

home+loan Home Loan
[N][T][T][N][T]
A Complete Guide on the Benefits of Joint Home Loan2022-11-16 | 5 min

home+loan Home Loan
[N][T][T][N][T]
Home Loan Balance Transfer: Benefits, Eligibility, and More2024-05-15 | 3 Min

home+loan Home Loan
[N][T][T][N][T]
Advantages for First-Time Home Buyers2023-07-14 | 4 min

home+loan Home Loan
[N][T][T][N][T]
An Essential Guide to Refinancing a Home Loan2024-04-22 | 5 Min

home+loan Home Loan
[N][T][T][N][T]
All About Home Loan Balance Transfers2024-06-04 | 4 mins

home+loan Home Loan
[N][T][T][N][T]
All You Need to Know About Home Loans2023-01-19 | 5 min

home+loan Home Loan
[N][T][T][N][T]
Should I Apply for a Pre-Approved Home Loan or an After Property Finalisation Loan?2024-03-15 | 5 min

home+loan Home Loan
[N][T][T][N][T]
Are Registration Charges Compulsory When You Opt for a Home Loan?2024-04-15 | 5 min

home+loan Home Loan
[N][T][T][N][T]
Difference Between Bank Rate and Repo Rate2023-09-22 | 5 min

loan+against+property Loan Against Property
[N][T][T][N][T]
Understanding the Fees and Charges on Your Loan Against Property2024-02-16 | 8 min

loan+against+property Loan Against Property
[N][T][T][N][T]
3 Different Loan Against Property Types You Should Know About2024-02-13 | 5 Min

tax Tax
[N][T][T][N][T]
What Does It Mean to Have a CIBIL Score of -1