All You Need to Know About Home Loan Transfer Charges

Dec 23, 2022

4 min. Read

All You Need to Know About Home Loan Transfer ChargesHome Loan

Every bank nowadays promises to be the one-stop destination for all home loan needs. When you have a ton of options to choose from, it really is overwhelming to choose one. Reading about home loans when you are making your decision to borrow is one of the best ways to conduct thorough research. While doing your research, be on the lookout for banks that offer services like Top-Up loans, home loan balance transfers, different types of home loans, etc. A Home Loan Balance transfer is a convenient facility through which you can transfer your home loan from your current lender to a new lender for a number of reasons.

Home Loan and Balance Transfer

A Home Loan Balance Transfer can be availed of when you want to enjoy some exciting offers provided by new lenders. The smooth process of Home Loan balance Transfer makes it an even more popular choice. There are many advantages of choosing to transfer your home loan but if not thought out carefully, you could face some problems too. Read below to find out the pros and cons of opting for a Home Loan Balance Transfer.

Pros and cons of Home Loan Balance transfer

Here are some pros and cons of transferring your home loan. Compare the two carefully and make your decision:


• Lowered interest rates- Enjoy decreased interest rates after switching to a new lender.
• Improved credit score- Make payments on time with decreased interest rates and improve your credit score.
• Affordable EMI- Low interest rates will reduce the amount of EMIs, making them more affordable.
• Flexible repayment- Choose the tenure to be longer or shorter according to your repayment ability.


• Fees and charges- You will have to pay fees and charges for getting a Home Loan Balance Transfer
• Terms and conditions- Sometimes the terms and conditions might not look completely satisfactory.
• Unpredictable rates- If you choose a floating rate, it might become high and extremely difficult to pay later on.

Things to Consider When Choosing a Home Loan Balance Transfer

• Type of interest rate
Research some new lenders and compare the rates they offer. Also, compare the terms and conditions offered by each lender. Choose the lender with the best options and finalise your decision.

• Terms offered
Closely read the terms and conditions offered by your new lender. Applicants make the mistake of ignoring the fine print and regret it later. Read all the terms and conditions and enter the contract if you find them agreeable.

• Tenure of Home Loan
If you are in the early stages of your repayment, it is the ideal time to apply for a loan transfer as you can enjoy low interest rates. You can also choose to repay the loan over a longer or shorter period according to your financial health.

• Top-Up Loan
Applicants who need some extra funds along with switching to a new lender must apply for a Top-Up Loan. Through a Top-Up Loan, you can get a considerable amount of funds to help meet your financial needs while being in debt.

When you need to choose Home Loan Balance Transfer

A Home Loan is a helpful friend that aids you in buying the home of your dreams but this dream can quickly transform into a nightmare if you have high interest rates and bad financial health. In such situations, we recommend choosing a Home Loan Balance Transfer. The perfect time to choose a Home Loan Balance Transfer is in the early stages of your repayment tenure as you can save a lot of money that you would have otherwise paid as interest. Another situation when it is highly advisable to switch to a new lender is when you are receiving substandard service from your current lender and terms are absolutely unagreeable. Make the decision to choose a new lender when you find your loan to be too much of a burden.

Home Loan Transfer Charges

A Home Loan Balance Transfer is certainly a good way to save some money but you must note that every good thing comes with a price tag. There are some fees and charges you will have to pay when you choose to avail of a Home Loan Balance Transfer. Here’s a list of Home Loan Transfer Charges:

• Processing fee:
A small percentage of the loan amount is charged as the processing fee by the new lender.

• Fee on account of an external opinion:
This fee is applicable when you get an external opinion from a lawyer and is payable directly to them.

• Home Loan Transfer Charges with EMI:
Home Loan Transfer Charges with EMI must be paid if there is a delay in EMI payments by the borrower.

• Incidental charges:
These charges are levied to cover costs that are expended in the recovery of dues.

• Statutory charges:
All statutory charges and taxes must be paid by the borrower.

Using a Home Loan Transfer Charges Calculator, you can find out all the Home Loan Transfer Charges you will have to pay when you transfer your home loan. Paying all Home Loan Transfer Charges is the responsibility of the borrower.

Home Loan Transfer Charges In India

A loan transfer is a popular option for Indian borrowers therefore Home Loan Transfer Charges in India are extremely affordable. Make sure you find out all about the terms, fees, and charges of a Home Loan transfer when you choose this option. Transfer your home loan today and enjoy all the benefits that come with it.

This article is authored by L&T Finance.

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