After a spell of economic downturn a notable revival in housing demand has prompted lenders to reduce housing loan interest rates. Notably, the home loan market in India is set to grow at a CAGR of 22% between 2021 and 2026, and RBI’s decision to keep policy rates unchanged is propelling this demand further.
On the other side, this has encouraged current borrowers to shift their housing loans to financiers offering relatively lower interest rates and better loan terms. In this regard, they can take the help of a home loan balance transfer calculator to compute the savings available with this facility.
Steps to use a home loan balance transfer calculator
Customers who had previously availed of a home loan at a higher interest rate can opt for a loan transfer. A balance transfer helps in making significant savings in terms of overall loan interest payment.
One can go through the following step-by-step guide to use an online balance transfer calculator:
Step 1: First, go to a website offering an online loan transfer calculator
Step 2: Now, enter the loan tenor, mentioning the starting and ending dates
Step 3: Next, provide the location of the property
Step 4: Enter the total sanctioned amount of the existing loan along with the residual repayment tenor and current home loan interest rate
Step 5: Provide the interest rate of the new lender where you wish to shift your current home loan
Step 6: Finally, tap on ‘Apply’
It will instantly provide the required results showing the details of a loan transfer. Additionally, one can also find whether he/she will be making any savings by opting for this facility. Almost every reputed lender today offers such online financial tools for their customers to help them make an informed decision.
Top advantages of using a loan transfer calculator
A home loan balance transfer calculator can be highly useful to borrowers looking to switch their housing loans from one lender to another. Here are some of the top benefits of using this financial tool:
- With a home loan transfer calculator, individuals can get a clear idea of the monthly installments they need to pay after shifting to a new financier.
- These tools will help borrowers to understand the exact saving they will make after opting to transfer the loan balance from the current lending institution.
- Borrowers can calculate the expected repayment tenor of the new loan after shifting over to a new lender. This will allow them to make informed decisions that would prove beneficial for their financial management.
- A home loan transfer calculator can be accessed anywhere, anytime, and free of cost. Moreover, it is quite simple to operate. One simply has to enter some basic details about the existing loan.
- The results provided are fast, reliable and error-free.
A balance transfer calculator provides the necessary insight to decide whether a balance transfer is worth it.
Tips to remember for a home loan balance transfer
Here are some of the significant factors to consider before one goes for a housing loan transfer:
- Balance transfer charges
When borrowers opt for a home loan balance transfer, they are basically applying for a fresh loan to the new lender. A balance transfer will come with various charges such as application fee, admission fee, processing, and inspection fee, among others. These charges can be levied either by the new or the current lender or by both.
One must calculate the charges to make sure the overall savings are not less than the amount incurred on charges. In addition, one should also be aware of the documents required for a home loan transfer. This will help in fast-tracking the overall process.
- Additional facilities
Besides a competitive interest rate, a balance transfer facility also entails additional features. This includes top-up loans, where borrowers can avail additional funds over their existing housing credit and at a similar rate of interest. A notable advantage of this fund is that it has no end-use restrictions. Hence, one can use it to meet an array of monetary needs. Additionally, better customer service is also another perk here.
- Pre-approved offers
Financiers extending pre-approved offers streamline the loan application process and saves time. These offers are applicable on financial products like home loans, loan against property and others. Individuals can check their pre-approved offers by submitting their essential contact details.
A home loan balance transfer calculator helps to get a better understanding of the savings one can make by opting for this facility. However, at the same time, individuals should keep these aforementioned pointers in mind and judge when they should opt for a home loan balance transfer facility.