Know How to transfer a Home Loan to another Bank
loan is the necessity of maximum homebuyers as the home buying process includes
a hefty amount. The changes in the Repo rate [RR], Reserve Repo Rate [RRR] and
other by RBI reflect as a change in the interest rate on home loan. This is a
major concern for the loan borrowers and thus we have listed everything you
need to know about transfer of a home loan to another bank.
What is a
Home Loan Transfer?
This process is also known as refinancing
a home loan. Here, a loan borrower can switch to a new lender who would offer a
low-interest rate in comparison to the present financial creditor. For example,
if the present bank has sanctioned you a home loan on 9% interest and other
bank is providing the same amount of loan on 7.5%. Then you can transfer the
remaining home loan balance to another bank.
the Features of Home Loan Transfer?
you can transfer the outstanding home loan amount from one bank to another that
charges the minimum interest rate on home loan.
you are required to pay 1% of the loan to the new lender as the loan transfer
application is also considered as a fresh home loan.
the homebuyer can transfer the ongoing loan only after the completion of
pre-defined tenure that is mentioned on the loan agreement.
the loan borrower has to deposit the entire outstanding principal and interest
amount to the new lender once the process of home loan transfer is completed.
for Home Loan Transfer
Any salaried, professional, businessman and self-employed person has the
eligibility to switch bank for home loan. However, all these loan applicants fall
under various categories and thus criteria for borrower switch is as follows:
person holding Indian citizenship and aged between 21 to 60 years are eligible
for transfer of the home loan. However, in case of self-employed or businessman
the maximum age limit is 65 years.
credit score alias the CIBIL score should not fall low during the time of home
loan transfer as the financial creditor assess this factor before approving the
loan transfer. The CIBIL score that you held at the time of availing home loan
is not considered in this process. So, maintain the credit score until the
competition of bank switch.
person is required to be working with the current organization for some
predefined period or the company should be operational for a long-time.
should yield the minimum monthly salary framed for availing the home loan.
required for Transfer of Home Loan
A home loan transfer is treated as
a fresh loan application and thus the loan borrower is required to submit the
below-mentioned documents for home loan transfer:
filled home loan application with passport-size photographs
Slip of the last three months as it describes the basic pay along with HRA and
months bank statements that show timely credit of salary
proof such as PAN Card, Driving License, Aadhar Card
Proof like Electricity bill
Proof such as 10th, 12 Certificate, Voter Id Card
businessmen are required to show the type of business and bank statements to
reflect yearly turnover
statements of the account from which home loan EMIs till now were debited
statement of the current bank and all the property documents
you consider home loan transfer?
The interest rate on home loan
witness changes and thus the new loan applicants sometime gets funds approved
from banks at a low rate. However, the old loan borrowers have to pay a higher
rate of interest. In this scenario, you can consider the option to transfer a
home loan is a big task, hence you must think twice before laying papers for a
loan transfer to another bank. You are suggested to assess the situation while regularly
paying the EMIs as the timely change in the Current repo rate, Reserve repo
rate and other by RBI reflects in interest rate on home loan overall.