Owning a home of your own is a luxury that everyone wants. It isn’t very easy to buy or construct a home for yourself anymore. So people opt for home loans which is one of the easiest ways to own a home without saving for decades.
Many banks and NBFCs provide Home Loans to people. So, there is no lack of lenders in the market. Still, some people may find a better option (lender) after availing of a loan from somewhere else. No worries! You can still transfer your Home Loan Balance to some other lender.
There are several reasons why a person would need to do a Home Loan Balance Transfer. Home Loans involve larger amounts than most loan types, and if a different lender is offering better rates and facilities, then why not change the lender.
There are many other reasons why a person would want to change their lender, as mentioned below.
- Better Interest Rates
It is the most common reason why a borrower would want to change his lender. Interest rate charges are the most important criteria in any loan type. If your lender is giving you a loan at 10% interest p.a, and another lender is offering you the same at 6 or 7% p.a, then the other is the ideal choice. A 2-3% change in interest charges can save you a lot of money.
Let’s take a simple example to demonstrate how much effect a single percentage of a Home Loan can make. Say a person takes 50 Lacs Home Loan at an interest rate of 10% p.a. If that interest rate is reduced to 7% p.a, it is simply a change of 3%. 3% of 50 Lacs is 1.5 Lacs, which is huge.
In such a situation, a borrower would want to change his Home Loan provider. It may not be a very easy process, depending on your current lender. Still, the financial benefits of changing the lender are worth a little trouble.
- Better facilities and features
Once you take a home loan, you must agree to certain terms of the lender. You may be comfortable with the terms at the start but face trouble later on, such as repayment modes or increasing your loan tenure to reduce the EMI.
Some lenders follow a very rigid system and don’t allow changing terms after taking the loan. Home Loan Balance Transfer is the obvious choice in such situations as well. Many borrowers don’t even know about various benefits they can get with a different lender until they change.
Another important feature that many borrowers want is “Foreclosure of account”. Many lenders impose heavy penalties on the borrowers for pre-closure of their loan accounts. To avoid paying such heavy penalties, many people transfer their loan accounts to different lenders.
- Poor Services by the Home Loan Provider
When you opt for a loan from any provider, you expect some features and benefits from the lender. If your lender cannot provide you with those benefits, you would want to change your lender. For example, If your lender does not provide you with the auto-debit facility, then it could be very troublesome for you to pay the monthly EMI’s.
Such basic features are necessary for today’s time, where digital payments are taking over the payment industry. Then there are several pre-loan and post-loan facilities that lenders provide. If you are not satisfied with the services, you must convey your problems to the lender. If you are still unsatisfied, you can consider Home Loan Balance Transfer that has the features you want.
Step-By-Step Guide To Transfer Your Home Loan Balance Provider
The above mentioned were some basic reasons why borrowers may want to transfer their home loan account to a different lender. Now let us try and understand how to go with the change and transfer of your Home Loan Account.
The maximum chances are that your lender will fix the problems you are facing. No lender would want to lose clients over little problems. If your lender still fails to handle your issues, you must follow the steps given below:
- Find The Right Lender For Yourself: If your current lender does not have certain features, you need to ensure that the other one does. You need to analyse different lenders all over again and make sure the terms satisfy your requirements.
- Consult your Lender: Before going to some other lender, you should consult with your lender first. If your current lender cannot solve your issues only, you should consider transferring your Home Loan Account to some other lender. Home Loan Balance Transfer can be a costly process, depending on your lender. So, you should consider all other options and keep this one as a last resort.
- Get all the documents: This process comes after you decide to transfer your loan account to some other lender. You need to get your Loan Account Statement from your lender. It has all your payment and dues details. Also, you need to get a NOC (No Objection Certificate) from your current lender. Some lenders don’t let people transfer their loan accounts to some other lender. So this part can be a bit of a bummer if you have signed your rights away to Home Loan Balance Transfer beforehand.
- Approval from the new lender: Now, you can bring all your documents to the new lender and ask for the Home Loan Balance Transfer. This process may not be challenging because lenders are always looking for opportunities to grab new customers.
You can now enjoy your loan account with your new lender on your terms. Even though the Home Loan Balance Transfer process can be a little difficult, but if you find the right one, it’ll benefit you in the long run.