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13 APRIL, 2022
A home loan is one of the best ways to buy the house of your dreams. This is mainly due to the flexibility and advantages it offers. You can repay the loan as per your financial comfort and even prepay the loan. However, one benefit that often helps borrowers deal with high-interest rates is a home loan balance transfer. With a home loan balance transfer, you can reduce your interest rate by transferring the loan. While it can help reduce your interest outgo and restructure the loan, it can also help you acquire extra funding without complex paperwork. Here are a few aspects of home loan balance transfer to be aware of.
How does a home loan balance transfer work?
When you apply for a home loan balance transfer, you avail a new home loan. Once your loan is approved, the new lender pays off your outstanding loan amount. When your old loan is foreclosed, you can pay the remaining EMIs on the revised interest rate.
What are the benefits of switching your loan?
By transferring the home loan after careful consideration and analysis, you can repay the loan faster and even save money on them. Here are some benefits of home loan refinance:
However, before opting for a home loan balance transfer, it is prudent to use a home loan refinance calculator to ensure that you get substantial savings from transferring your loan.
How can balance transfer help acquire extra funds?
Many lenders offer top-up loans when you apply for a balance transfer. With this facility, you need not apply or go through the formalities and documentation of availing other loans from scratch. The lender offers top-up loans over and above the home loan amount, which you can use to fund your additional needs.
How can you get a top-up home loan?
The top-up loan amount can vary based on the mortgaged properties amount, number of EMIs paid and your current home loan, eligibility and credit score. Similarly, the parameters for top-up loan tenures also change based on your lender and financial profile. The lender can also have a limit on the amount of top-up loans you can avail.
A home loan balance transfer is an easy way to get rid of your older loan and acquire extra funds for managing your expenses with ease. With these funds, you can meet your financial needs without availing other unsecured loans. Moreover, if you use top-up loan for home renovation, repairing or refurbishing, you can also avail tax benefits.
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