Real Estate Web

Archive for January 2nd, 2012

Balance Transfer And Housing Finance

The Indian immovable property has come of ages. Consumer is the King now and gone are the days of monopolistic behaviour. And definitely if you are the one with sound financial background and impeccable credit record you can strike a better deal with the banks in terms of interest rates and other payment conditions and purchase your dream property without any hassle.

Interestingly the same criteria is equally applicable on those as well who have already availed a loan from a bank. Near about all the major public and private sector banks in the Indian banking system are now offering the option of ‘Balance Transfer’ on housing finance. Often banks in the housing finance sector tend to increase the interest rates when the benchmark interest rates increase. But such alacrity is not shown by them in decreasing rates whether the Repo rate comes down or not. In such circumstances balance transfer help the customer a lot. He can replace the higher rate loan and avail a lower rate one by paying some extra charges. These charges are lower compared to the total payable interest.

What is Balance Transfer and how is it relevant in the housing finance?

There are times you find that the interest rate on your home loan is at a higher level. Take an example. Suppose you were paying at the rate of 10.5 per cent per annum. This rate is quite high in comparison of 9 per cent offered by some other bank. In such cases balance transfer of housing finance comes into rescue. You can trigger off the balance transfer option with your existing bank or lending institution under which the unpaid portion of your housing finance would get transferred to your desired bank thereby taking benefit of the difference in the housing loan interest rate.

Things to take care of at the time of balance transfer:

About the writer:  For more information about home loans and loans against home. Please visit our website: http://www.paisawaisa.com/