Home Loan Balance Transfer - An Easy Way to Reduce Your Home Loan Interest

A home loan is a long-time financial commitment where you spend a large amount of your income in repaying it. Half of your monthly installment's amount comprises of the interest rate you pay to the lender. The current interest rates on home loans range from 8.10% to 12.50%. If you are paying a high-interest rate on your home loan, it's time you must consider a home loan balance transfer.rnIt is better that you consider home loan balance transfer in the initial 4-5 years of the loan tenure. Loan transfer in mid or end of the tenure won't benefit you as you have already repaid a higher amount to the lender.rnWhy should you consider home loan balance transfer? • The primary reason why you must consider the balance transfer is the reduction in interest high rates. • When you reduce the interest rates, your monthly installments will go down significantly. • You can also avail home loan top up at the same new rate as a home loan. • You can avail of other offers and discounts offered by the lender such as no processing fees and other charges.rnHowever, you must consider a few eligibility criteria before you decide to transfer your home loan balance. • Your new finance company may require that you must have paid at least 6 to 12 EMI’s on existing loans before opting for a balance transfer. • You must have a clean repayment history with any default in payments and maintain a good credit score. • You must possess all the required documents for the balance transfer process.rnSo, before you decide to opt for the balance transfer, do a thorough analysis of all savings and costs associated with the transfer of the loan. Do complete market research before you choose the lender to transfer your loan.