It is no surprise that buying a property is no small feat, given how expensive real estate prices are. What most people do to be able to afford the cost of a property is apply for home loans. There are many home loan plans that borrowers can choose from based on their budgets. However, home loan plans keep changing. It is common for financial institutions to keep revising the terms of their home loan plans in order to attract more customers. These terms can also be affected by market conditions.
It is understandable for a borrower to worry about taking a home loan and then missing out on a better deal a few years later. However, the good news is that you do not have to miss out on a better deal! You can always opt for a home loan balance transfer, which means that your outstanding loan debt will be transferred to another lender. Most borrowers choose this shift for a reduced interest rate. But does a slight change in the interest rate really benefit the borrower? Yes, it surely can!
Take a look at how a reduced home loan balance transfer interest rate can help you:
- You can save on the overall cost of the loan
The focus of any borrower is to save as much money as they can on the overall cost of the loan. While a slight difference in the interest rate might not seem like much, it can actually make a significant difference to the overall cost of the loan. It is advisable to make use of a home loan balance transfer calculator and check the potential savings you can make by refinancing your home loan.
- The loan EMI payments can get easier
Many borrowers struggle with the repayment of their home loans. Going for a home loan balance transfer can actually help in solving this problem. With a reduced interest rate, the revised monthly instalments would be lesser than what you are currently paying, thus easing your EMI burden. You can make use of a home loan refinance calculator to understand what the revised EMIs would be.
- You will have an increased spendable income
After paying off the home loan’s monthly instalments, you might be left with a small spendable income, thus unable to build your savings. However, with a reduced home loan interest rate, your EMIs would come down. This helps in increasing your spendable income, which leaves room for savings too.
Lastly, a reduction in the interest rate is not the only benefit that borrowers can get by transferring their home loans. Many borrowers also refinance their home loans to get a top-up loan, or a better repayment tenure to ease their EMI payments. Some borrowers are not satisfied with the service that their current lender is providing and thus choose to transfer their loan to a different lender.
