Home loans play an important role in purchasing of a house. These loans are available at a cost and they are for long periods. The quantum of loan depends on various factors ranging from repayment capacity, previous loan records and above all Cibil scores. Once the loans are taken EMI’s play a regular role in one’s life until the loan is repaid. Individuals start recalculating whether the decision to take a loan from a particular lender is correct or not. Then comparative analysis starts. In this process, various conclusions are drawn. So it is necessary to know about loan transfer process.
Loan transfer is a process where the loan of an individual is transferred from one lender to another. In this process, it is important to note what are the benefits and what can be the problems. The main factor for transfer is interest rates. RBI guidelines are given in loans interest and many times the rates are reduced. Some of the banks transfer the benefit to customers and some do not. If the lender from whom the loan has been taken transfers benefit it is good otherwise we will be at a loss. Other than the interest the other factors also play an important role.
Calculate the total outflow-
This means calculations should be as to how much in total should be repaid if we continue with the present lender and how much should be repaid if we switch over. The reason is there are extra charges to be paid when the loan is taken over by the new lender. These amounts are called processing fees and also include stamp duty, legal charges, technical charges etc.
Collateral to outstanding ratio- This is in regard to security kept when original loan had been taken. If the same amount of security is again given then there is every chance that a heavy security is given and in future, if another loan is needed we shall not have further security to give.
Benefits from present loan and what extra is got from loan transfer- There can be benefits from the existing loan and also some extra, the switch over is going to give. This can be in form of insurance, NEFT transfers etc.
- Terms and conditions governing loans
Many times there are certain hidden rules in the agreements. It becomes necessary to read in between the lines before the agreements are signed. Sometimes it is necessary to have fixed deposits while taking loans. There may some specific clauses of getting work done from certain companies only.
Other frills-
To attract a new customer heaven is shown and in reality, this may not be the case. Before shifting it would be advisable to take the opinion of a person who has been dealing with the bank/ lender and can give an honest opinion. The benefits promised are there for lifetime or after a certain period they have a tag.
Conclusion
When it has to be moving out from one loan giver to another only one factor should not be considered as in this competitive market no one wants to lose a customer. So speak to present lender put what apprehensions are there in your mind get them clarified and if still not satisfied then a change can take place.
