Balance Transfer

A home loan balance transfer (also called refinancing or loan takeover) lets you move your outstanding home loan from your current lender to a new one offering lower interest rates or better terms.

How It Works:

For example:
• You have a ₹40 lakh home loan at 9% interest with Bank A.
• Bank B offers 7.5% interest.
• You apply for a balance transfer.
• Bank B pays off Bank A, and you now repay Bank B at the lower rate, saving money.

Why People Opt for Balance Transfers:
• Reduce interest rates (biggest benefit)
• Lower monthly EMIs
• Save lakhs over the loan tenure
• Access top-up loans or better customer service

Things to Consider Before Switching:
• Processing fees & other charges (legal, technical, administrative)
• Foreclosure or transfer charges from current lender
• Remaining loan tenure (transfers are more beneficial early on)
• Your credit score and eligibility
• Hidden clauses or fees in the new lender’s agreement

Example of Savings:

• Loan: ₹50 lakh over 20 years
• At 9% interest → Total interest: ~₹58.5 lakh
• At 7.5% interest → Total interest: ~₹46.3 lakh
• You save ~₹12.2 lakh by transferring!