Friday, July 11, 2014

Transferring Your Home Loan: Things to Consider

When banks offer interest rates lure that seems better than your current bank withdrawal of your home loan, you may be tempted to transfer the loan. But remember the point that each bank has its own marketing strategy, and it might not be what they seem on the outside. It's important that you know the details of the bank offer deep. There are other important things to take into account than just the interest rate on your loan. The following are things to consider when you transferring your home loan.

Compare Total Outflow

While the new bank can attract you to his side by offering reduced EMIS and lengthen the repayment period of your loan, you should be aware that this may increase the total amount you have to pay in the end due to the addition of the continuous interest rate for your loan amount. If your current EMI is higher than what is being offered a new bank, you have to compare the total outflow from the two banks before you shift. Unless you are struggling to pay your EMI this time, is not advisable to shift banks just for the decline in interest rates.

Be Sure to Negotiate

If you do not want to be dictated by the terms of your new bank, although you find some aspects of the offer to be attractive, make sure to negotiate. Negotiations can take you away from that at the mercy of your lender and can even give you the upper hand. Banks do not want to lose their borrowers, especially if they have a clean record in repaying the loan on time. So more often than not, the negotiations will be considered by the bank.

Switch on the Right Time

In general, your EMI structured in a way that you pay the interest component first and then your main components. So if you make the switch at the beginning of the period of your loan, you will pay a higher amount to the interest component, whereas if you switch on the end, you will pay a higher amount to the main component. If the new bank has an attractive interest rate, you get the maximum benefits with the switch during the initial period. Timing switches correctly can save a lot of money.

Notice Terms and Conditions

Every time you switch to a new bank, it is important that you thoroughly read the terms and conditions of both the old and new banks. Some banks may have a condition such as buying insurance from a particular company or other such terms. Acquire complete knowledge before signing the document.

Know the Cost of Allied

Especially with home loans, you should know that transferring your loan comes at a cost as processing fees, stamp duty, legal fees, technical costs, appraisal costs, and much more. You must take all this into account and see if the offer of a new bank is worth.

The author, who focus more towards highlighting social issues we face every day. I give tips on property investment, writes on real estate market trends, and provides insight into the latest housing projects. For questions related more solid, you can call directly on this number 877-591-5975, so there is no mistake when you want to access it.

1 comment:

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