We explain what a loan transfer means, and why IDFC First Bank should be your partner in the process.
For most home buyers, the prospect of buying a house without the help of a home loan is an unimaginable one. Indian realty continues to labour under high prices, and most properties are out of the reach of scores of buyers.
But taking a home loan solves the problem efficiently. However, there is more to taking housing finance than meets the eye. After taking the loan and embarking on the EMI schedule, you begin to feel the high interest rate pinching your budgets. It may be time to look for a home loan transfer at this point.
The 3 important parts of a home loan
- The principal amount or the loan amount
- The interest charged on the loan
- The tenure or term of the loan
* The home loan interest rate is the most important part of the home loan. The higher the rate of interest, the higher the monthly EMI and the more expensive the loan becomes.
* You might take a fixed or a floating rate of interest. In recent months, some banks have raised the floating rate of interest steadily. This means that your EMI increases, and so does the final amount of money you repay to the bank.
* At this juncture, you have two options: 1, repay the entire loan amount or make partial pre-payments to reduce the principal, and 2, effect a home loan transfer to another bank that offers a lower home loan interest rate.
What is a home loan transfer?
- The home loan transfer is a process under which an existing home loan is shifted from one lending institution to another, so that the borrower may avail of a lower rate of interest with the latter.
- Banks and financial institutions in India slash lending rates periodically, thus making floating loans cheaper. If rates are lower in other banks, you can ask for a rate reduction with your current lender.
- But if your current lender is not open to rate negotiations, you can transfer your home loan to another bank like IDFC First Bank. The balance amount is transferred to the new lender, with a revised EMI schedule.
- IDFC First Bank offers competitive rates of interest and an easy home loan transfer process as well. Besides, the bank charges nominal processing fees on transferring the home loan. The paperwork is minimal and approval comes through quickly.
- Do proceed with the home loan transfer only after checking the home loan interest rates and the processing charges being levied.