05 JUNE, 2020

In the past several years, personal loans have become one of the most preferred financial products in the market. The unsecured loan allows one to conveniently acquire funds in the time of financial uncertainty. There is no end-use criterion for a personal loan and thus, it can be used to fulfil diverse purposes. It thus comes as no surprise that a growing number of people opt for a personal loan for travel, funding weddings, medical emergencies, and more.

If you already have a personal loan or plan to take one, it is essential to understand the importance of a personal loan balance transfer. As the name suggests, this facility lets you transfer your loan balance from one bank to another. The transfer of your principal loan amount from one financial institution to another institution is done in a bid to avail more attractive features. Read on to know the different benefits that are associated with a personal loan balance transfer:

Lower rate of interest – A significant aspect of getting a personal loan is availing a lower interest rate. This must essentially stand to be your primary reason for making a shift from your current lender to the new lender. Lowering your interest rate on your personal loan will help you save a big portion of your monthly budget. The reduced EMIs will ensure that you are able to clear your debt burden much faster.
Negotiate the loan tenure – Long after opening your personal loan account, you may revaluate and notice that you do need a longer or shortened loan tenure. With a personal loan balance transfer, the new provider also lets you choose a new suitable tenure. If you think that you are in a better position to pay a higher amount EMI, then you can opt for a shorter tenure. On the other hand, you pick a longer tenure if you wish for a smaller EMI.
Attractive facilities – The new lender may offer you facilities that are much more attractive. Some of these include a waiver on processing fees, waiver on the last EMI, personalized customer service, and more. However, the facilities offered will also depend upon your personal credit profile. If you have a strong past credit history, you are likely to be offered much more lucrative facilities upon getting a balance transfer.

The benefits attached to a personal loan balance transfer help in easing your overall debt burden. However, carefully evaluate your decision before undertaking a balance transfer. Compare the choices, pick a reputed bank, undertake important calculation, and keep in mind any additional cost that you may incur.