Loan Balance Transfer · 4 min read
Should You Transfer Your Home Loan?
If you took your home loan a few years ago, there is a good chance newer borrowers are being offered better rates. A balance transfer lets you move to them — but it only makes sense if the saving outweighs the cost of switching.
When a transfer usually makes sense
- The rate gap is meaningful — often 0.5% or more
- A large part of the tenure is still left, so the saving has time to add up
- Your credit score and income have improved since you took the loan
- You also need a top-up and the new lender offers it at a home loan rate
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Check My RateWhen it may not
If only a few years remain, most of your EMI is already going toward principal, so a lower rate saves less. Also ask your current lender for a rate revision first — many will reprice an existing customer for a small fee, which avoids fresh legal and valuation costs.
Costs to account for
The new lender's processing fee, legal and valuation charges, and stamp duty or registration costs for the new mortgage. RBI rules do not allow foreclosure penalties on floating-rate home loans to individuals, so your current lender should not charge for closing the loan.
Common mistakes
- Switching late in the tenure when savings are small
- Ignoring the new lender's fees
Frequently asked questions
When should I transfer my home loan?
When the rate difference is meaningful and a large part of the tenure is left, so savings clearly beat the switching costs.
Interest rates, fees, eligibility and loan terms vary by lender and borrower profile. Information on this page is for educational purposes and should not be considered a guarantee of approval or a specific rate. RateWise is a loan advisory, not a lender. Privacy Policy