Apply for Home Loan Balance Transfer
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Home Loan Balance Transfer
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Home Loan Balance Transfer

Existing home loan borrowers of banks and HFCs can transfer their existing home loans to other lenders offering lower interest rates, better terms, and offers. The interest rates offered to home loan balance transfer applicants are usually similar to regular home loans. Home loan balance transfer not only helps reduce the interest rates but also helps in reducing the overall EMI and interest cost.

Banks and HFCs usually offer home loan balance transfer interest rates starting from 7.10% p.a. onwards. The lender sets its HLBT interest rates after factoring in the credit profile of applicants. Below-mentioned is the home loan interest rate comparison of the top lenders offering home loan balance transfer to their applicants.

  • Reduces EMI burden and eventually the interest cost.
  • Better loan terms and offers by the new lender.
  • Flexible loan tenure.
  • Top-up funds available along with a balance transfer.

Applicants should opt for a home loan balance transfer only when,

  • The current interest rate is higher than the market rate.
  • You want to reduce your EMI burden.
  • Your credit score has improved, and you are eligible for lower rates.
  • The new lender offers better offers and services.
  • The loan repayment is in the early stages.

When you transfer your home loan to another lender, even a slight reduction in the interest rate can help you save substantially. Let us understand this with the help of an example.

Interest rate of the existing lender 7.90% p.a.
Loan amount Rs. 50 lakh
Loan tenure 30 years
Existing EMI Rs. 36,340
Existing interest cost Rs. 80.82 lakh
Interest rate of the new lender after the balance transfer 7.10% p.a.
Outstanding loan amount transferred Rs. 40 lakh
Remaining loan tenure 20 years
New EMI Rs. 31,253
New interest cost Rs. 35 lakh
Overall savings on EMI Rs. 5,087
Overall savings on interest cost Rs. 45.81 lakh
  • Minimum age of the applicant at the time of loan application should be 18 years, and maximum age at the time of loan maturity should be 70 years.
  • Existing home loan borrowers are eligible for a home loan balance transfer.
  • The EMI/NMI ratio of the applicant should be below 55%, including the existing EMIs and EMIs of the proposed home loan.
  • Most lenders prefer applicants to have a minimum credit score of 750 and above.
  • Salaried and self-employed individuals with a strong credit profile are eligible for a home loan balance transfer.
  • The outstanding balance should be high.

Below is a list of documents that a lender may generally ask at the time of approving your home loan balance transfer application.

KYC Documents

  • PAN card
  • Aadhaar card
  • Passport
  • Driving license
  • Voter ID

Income Proof

  • Salary slip for the last 3 months
  • Bank account statement for the last 6 months
  • Form-16/ITR
  • Balance sheet and P&L statement for the last 2 years
  • Latest form 26AS

Property Documents

  • Allotment letter
  • Title deed
  • Proof of no encumbrance
  • Compare interest rates and offers by multiple lenders.
  • Maintain a high credit score (preferably, 750 or above).
  • Check the other costs associated with the home loan (processing fees, foreclosure charges, etc.)
  • Calculate the total loan cost before transferring your loan to the new lender.
  • Negotiate with the existing lender.
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