Home Loan Balance Transfer: Transfer Your Home Loan Smartly

What Is a Home Loan Balance Transfer

A home loan balance transfer allows you to transfer home loan repayment obligations from your current lender to another financial institution offering more favourable terms.
Also referred to as a house loan transfer, this process can help lower your EMIs and reduce your overall interest outgo.
In essence, a balance transfer on a housing loan is ideal for borrowers seeking to ease their repayment burden while benefiting from improved customer service and flexible terms.

Key Benefits of a Balance Transfer on a Home Loan

The biggest advantage of a balance transfer on a housing loan is the potential to save significantly on interest payments over the loan tenure.
Here’s why many borrowers choose a home loan takeover or housing loan takeover by another lender:

• Lower Interest Rates: Reduce your EMIs by switching to a lender offering a lower home loan interest rate.
  
• Top-Up Loan Facility: Avail additional funds* along with your housing loan transfer for home improvement or other financial needs.
  
• Flexible Tenure: Adjust your repayment period to better align with your financial situation.
  
• Reduced Financial Burden: Pay less interest over time and improve long-term savings through the balance transfer on the home loan.
  
• Enhanced Customer Service: Move to a lender offering responsive service and convenient digital loan-management options.
  
• Availability of Tools: Use tools such as a home loan balance transfer calculator and a home loan EMI calculator for effective financial planning.

*Terms & conditions apply

Eligibility & Documents Required for a Home Loan Transfer

Before you apply for a transfer on a housing loan, you’ll need to meet certain eligibility criteria and submit key documents. A strong financial profile not only improves your chances of approval but also helps you unlock better terms on your home loan balance transfer.

Common Home Loan Eligibility Criteria

• Age: Minimum 21 years at application and no more than 65 at loan maturity.
  
• Income: Stable monthly income (salaried or self-employed)
  
• Credit Score: 700 or above
  
• Repayment History: Consistent and timely EMI payments on the current loan
  
• Loan Type: The original loan must allow a home loan balance transfer

The following entities are eligible to apply for a house loan transfer:

A good credit profile and stable income significantly increase your chances of approval for a balance transfer on a housing loan.
If you meet these criteria, you can apply for a home loan balance transfer and take advantage of reduced interest rates or improved repayment terms.
*Please note that these are only the basic housing loan transfer eligibility requirements. The final eligibility will depend on several factors, including our policies at the time of loan application.

Documents Required to Transfer a Housing Loan to Another Lender

Home loan transfer documents for salaried applicants:

• PAN card
  
• Identity proof (Voter ID, driving licence)
  
• Address proof (Aadhaar card*, latest electricity bill/piped gas monthly bill)
  
• Income proof (Last 3 months’ salary slips, 2 years’ Form 16, 6 months’ bank statements with salary credits)
  
• Documents pertaining to the property

Home loan transfer documents for self-employed applicants:

• PAN card
  
• Identity proof (Voter ID, driving licence)
  
• Address proof (Aadhaar card*, latest electricity bill/piped gas monthly bill)
  
• Income proof (Last 2 years’ ITR with computation, CA-audited financials, 6 months’ primary bank statements)
  
• Documents pertaining to the property

Ensure that all your documents are complete and accurate to avoid delays during the balance transfer on the housing loan process.
You can explore the full list of home loan documents required here.
*Terms and conditions applicable. Loans are sanctioned at the discretion of SMFG Grihashakti. Please note that Aadhaar numbers should be masked before submission as per regulatory guidelines.

Fees, Charges & Cost of House Loan Transfer

While a housing loan transfer can help you achieve significant long-term savings, it is important to be aware of the associated costs.
Before initiating a home loan balance transfer, ensure you’ve reviewed all associated charges, including the following:

• Processing Fee: Up to 3%* of the loan amount
  
• Application Fee:
  
• INR 2,500 – for loan amounts up to INR 10 lakhs
  
• INR 3,500 – for loan amounts between INR 10 lakhs and INR 25 lakhs
  
• INR 4,500 – for loan amounts between INR 25 lakhs and INR 50 lakhs
  
• INR 6,000 – for loan amounts above INR 50 lakhs
  
• Documentation Fee:
  
• INR 1,500 – for loan amounts up to INR 25 lakhs
  
• INR 3,000 – for loan amounts above INR 25 lakhs
  
• Stamping Charges: As per state laws

SMFG Grihashakti maintains full transparency in all fees and ensures that there are no hidden charges associated with the house loan transfer process.

When & Why Should You Consider a Home Loan Balance Transfer?

Here are some common reasons borrowers opt to transfer a home loan:

• Another lender is offering a significantly lower interest rate
  
• Improved credit score and financial profile
  
• Unsatisfactory service from the current lender
  
• Need for a top-up on the existing loan
  
• Desire to reduce EMI or adjust the loan tenure

A timely balance transfer on a housing loan can help you save a substantial amount on total interest payable and enable you to restructure your finances more effectively.

How Does the Home Loan Balance Transfer Process Work?

Here’s a simple, step-by-step overview of how the balance transfer on a home loan process typically works. Please note that specific steps may vary across lenders:

• Review Your Current Loan: Check outstanding balance, tenure, and foreclosure terms.
  
• Compare Savings: Use a home loan balance transfer calculator to estimate savings.
  
• Apply with New Lender: Fill out the online application form and submit the required documents.
  
• Receive Sanction Letter: The new lender reviews your application and issues a sanction letter, subject to eligibility and successful document verification.
  
• Obtain NOC from Current Lender: Request a foreclosure statement and No Objection Certificate (NOC) from your current lender.
  
• Loan Disbursal & Closure: The new lender pays off the old loan, and EMIs will then commence as per the revised terms.

Savings & New EMI Illustration Through a Home Loan Balance Transfer

Let’s assume you are repaying a home loan of INR 50 lakhs at an interest rate of 12% p.a. for a tenure of 360 months (30 years).

If you opt to transfer the house loan to another lender offering a 10% p.a.* interest rate, here’s how your potential savings could look:

Things to Watch Out for in a Home Loan Balance Transfer

Although balance transfer on a home loan offers several financial advantages, you should evaluate the following factors before proceeding:

• Transfer Costs: Make sure all associated transfer costs do not offset potential savings.
  
• Prepayment Penalty: Check if your current lender charges any foreclosure fees.
  
• Remaining Tenure: A balance transfer is generally more beneficial during the early or mid-phase of your loan tenure.
  
• Eligibility Constraints: Factors such as your repayment history and property valuation can affect the approval process.
  
• Documentation Delays: Ensure your documents are complete to avoid delays.

Always evaluate the long-term benefits carefully and use tools such as the home loan eligibility calculator to assess whether the transfer aligns with your financial goals.

Why Choose SMFG Grihashakti for Home Loan Transfer

With SMFG Grihashakti, you get a seamless, transparent, and rewarding home loan balance transfer experience. We offer competitive interest rates, a straightforward process, and the flexibility to avail a top-up loan to meet your additional financial requirements.
Use the transfer calculator to estimate your potential savings and begin your housing loan transfer journey with us today.