When To Do A Balance Transfer Of Your Home Loan FundooMoney

When To Do A Balance Transfer Of Your Home Loan

If present home loan EMI is a major financial burden for you, it's time for a home loan balance transfer. Shift your home loan to another lending institution through a home loan balance transfer. Some key things to keep in mind

Welcome to FundooMoney, your 24X7 buddy on all your money matters. Banks and other financial institutions keep sending you mails and make phone calls about lower home loan rates for your home loan. The question is, should you refinance your home loan? We provide the answers but in just a while.

Who doesn’t want a lower home loan EMI? But you should refinance you home loan only under the following conditions.

You are paying a high home loan interest rate
If you feel that you are paying a high home loan interest rate, you would do well to do some market research. For instance, you could take the help of a home loan calculator in an established website and find out about the current home loan interest rates and EMIs, especially from other home loan providers.

Cheaper alternatives are available
If you are being charged a high interest rate while other lenders are offering home loan at much lower rates, you should consider refinancing your loan. However, ensure that the home loan provider will provide a loan for your property.

When your loan enters floating rate period
Hybrid home loans have a fixed interest rate for the initial years, followed by a floating rate for the remaining period. If it’s not more than 2-5 years away, wait out this period and refinance your loan. This will save you any prepayment penalty involved with the fixed rate period.
After your loan enters the floating rate period, compare the interest rate being offered by other home loan providers. If there is a difference of 1 percentage point or more, refinance your home loan.

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