Many financial institutions today are disbursing home loans at highly lucrative interest rates. This allows the borrower or the individual to easily switch banks and repay the principal loan amount at an interest rate that is lower than earlier. It is a highly lucrative prospect and gives a chance to the borrower to save some money. However, a home loan balance transfer does not come without any roadblocks.
Here are the top five hurdles in availing of a home loan balance transfer.
1. Time-consuming process
At the time of applying for a home loan balance transfer, the lender will need you to fill numerous forms. In addition, you will be asked to furnish various documents. Once you get through this phase, there will be scrutiny, which is a complicated process. Hence, go through the pros and cons of making the switch before you fill up the application form.
2. A one-sided risk for the lender
The lender may or may not approve your application. This is because the lender will not have any real advantage. You might get a better interest rate but the lender will carry the risk. There will not be any transfer of ownership to the lender.
3. A signing fee is involved
One of the biggest difficulties in availing of a home loan balance transfer is the processing fees, which will be charged by the lender. The fees will vary from one lender to another but you will have to ensure that you have enough balance to pay the fee, which will be incurred.
4. Previous lenders can create problems
The financial institution that is losing you as a customer might create some obstacles in the way. This could affect your entire plan because you will have to obtain a ‘No Objection Certificate’ (NOC) from the lender before applying for a transfer.
5. Consent of the co-borrower might be needed
You need to verify this with the new lender. There might be a requirement of the co-borrower’s approval in order to switch the loan. In many cases, you might also need the co-borrower to be present at the time of the switch.
Since you are a new customer for the new lender, you will have to follow the entire procedure right from the start. Various important factors such as your CIBIL score, age, and the history of previous loans along with the repayment records will be considered. Always ensure that the new terms and conditions offered to you are beneficial and outweigh the hurdles. This will allow you to save money and make the repayment of the loan before time. Consider all your options and then make a decision. You have to know that the interest rate might be lower on the new loan but you will still be required to make payments on time.
If you are looking to lower the cost of your home loan, then you are definitely at the right place. You can now easily avail a Bajaj Finserv Home Loan Balance Transfer facility on Finserv MARKETS and take advantage of a plethora of benefits like fast application processing, quick dispersal and many more! So why wait? Apply for a Home Loan Balance Transfer with us, today!
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