Living in the own house is a dream of almost each and every person. To support and help the people fulfilling the dreams, the banks such as HDFC, ICICI, SBI and FIs such as Bajaj Finance, Tata Capital etc. have extended their hands to support people’s dream of own home and started providing home loan facilities. The borrower can check the eligibility criteria online and apply for the housing loans by following certain simple steps. The rate of interest, monthly installments and duration to repay the loan may differ according to the different housing loan providers. The borrower can even calculate the monthly installments with the help of EMI calculator that is usually available on lender’s website and proceed ahead with the home loan by keeping appropriate planning in the mind that does not affect the monthly budget adversely.

If the person has availed the facility of the home loan, then to reduce the burden of the same, the person can find the new lender and transfer the home loan balance to avail the various benefits offered by the new lender. But, the documentation for the home loan balance transfer involves a stringent process. The Finance Buddha has come up with the complete detailed checklist to help our readers, viewers and customers in order to understand and use the same, while proceeding for the home loan balance transfer procedure. The borrower chose to change the lender for the home loan due to variety of the reasons.

Guide to Home Loan Balance Transfer

If the borrower finds the new and better option with the new lender and if the deal is beneficial for the borrower then he or she can opt to go for the home loan balance transfer. Some lenders even provide the customized repayment system for the loan. The balance transfer option can be important in terms of home loan because the same consists of long term duration. If the borrower is in the initial stage of the home loan, then it is always advisable to opt for home loan balance transfer if the new option provides the better & lower interests, monthly instalment options and tenure. However, at the same time, if there are only few years left to complete the repayment of the loan, then the borrower should go ahead with the old lender only, because there is a possibility that the balance transfer processing fees, charges, etc., by paying such amount the borrower may end up paying even more amount then the required one. Hence, it is essential for the borrower to carefully assess each and every criteria before opting for the home loan or any kind of loan balance transfer option.

Top 5 Hurdles of Home Loan Balance Transfer

The following documents are asked by the banks, financial institutions or lenders for the home loan balance transfer. If you are looking for to transfer your home loan, we recommend you to be ready with below mentioned set of documents.

  1. PAN Card
  2. Identity Proof (such as Aadhar card or license)
  3. Residence Proof (In the case of owned residence)
  4. Rent agreement (if the person is staying in the rented property)
  5. Latest Cost to company proof
  6. Salary Slips for last three months
  7. Bank Statements for last 6 months
  8. Latest Form 16
  9. Latest Landline Bill or Credit Card Bill or Electricity Bill
  10. Loan payment track records
  11. Income Proof
  12. Business Financial Statements in case if you own a business
  13. All the property related documents
  14. Original & photocopied documents to be submitted

The process of home loan balance transfer includes some simple steps, by following which; you can complete the entire procedure within 3 or 4 days. In the process, first of all, you have to provide the request letter to your existing lender for the transfer of home loan balance. Once, the same gets approved by the current lender, the lender provides the letter of consent approving the balance transfer to another lender. Apart from the letter of consent, the NOC (No objection certificate), foreclosure of the loan certificate, property documents lists and loan statement consisting of your monthly payment history is required. Once, you apply for the loan to the new lender, you have to submit the fresh set of documents just like processing for the new loan. You have to submit the fresh application form along with your passport size photographs. Apart from the same, the borrower has to also submit the other documents such as date of birth proof, address proof, signature proof etc. The ownership of the property related documents are also to be submitted. You have to also provide the “No objection Certificate (NOC)” from your housing society and builder.

Things You Should Know Before Changing Your Home Loan Lender

The lenders will ask for the income proofs such as salary slips (last three months), bank statements, Income Tax Returns (For last 2 years) etc. If the borrower is a businessman or self-employed then the proofs related to business community is required. If the borrower is a salaried person, then it is essential to provide salary slips and appointment letter to the new lender. The bank statements for the last three months are also required as an important proof. The new lender will be verifying all the documents provided by the borrower. This will be helpful for the lender to know the financial history of the borrower. The strong financial history gives the sense of security and confidence to provide the balance transfer for the lender. According to the financial history, the new lender shall be deciding whether the borrower is falling under the eligibility criteria or not. Once the loan gets approved the new lender will hand over the cheque of balance principal amount to the old lender, so that the old lender can transfer all the loan papers to the new lender. With the help of this, the post-dated cheques, which have been given to the old lender, will stand cancelled and the process of the balance transfer can be completed.