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Strategy for Saving Money with a Personal Loan Balance Transfer
Posted on Friday, March 10th, 2023 | By IndusInd Bank
When a financial emergency strikes, most of us tend to act in haste, ending up opting for the first personal loan we come across – no matter how high the rate of interest.
While this is a fairly common mistake, there is, luckily, a way to make amends. Once your emergency is over, you may always look at the option of considering a bank that is offering the loan at a lower rate of interest. This incredible money-saving strategy is known as a personal loan balance transfer and here is everything you need to know about it.
Personal Loan Balance Transfer – The Definition
In simple words, a personal loan balance transfer is a process in which a customer transfers their entire outstanding Personal Loan from one bank to another. This usually happens when the second bank offers a lower rate of interest than the first on the outstanding loan amount, effectively reducing the total cost of the loan for the borrower.
While the personal loan transfer process does not require any kind of collateral, you may have to pay nominal charges for the transfer including foreclosure charges – only if the personal loan was availed on a fixed interest rate; processing fee – which may be discounted or waived in some cases – and stamp duty on the loan agreement (if applicable).
Financial – and Other – Benefits of Personal Loan Balance Transfer
I. Lower Interest Rate:
The most obvious benefit of transferring your personal loan for a lower interest rate is that it saves money. Consequently, the overall debt burden is reduced through lower EMIs.It must be noted that increased savings resulting from a lower interest rate even make up for charges such as a processing fee.
II. Availability of Top-up Loan Facility:
Banks often allow a top-up loan facility when you transfer a personal loan from another bank. This can be a particularly helpful feature if you need more funds, as you can obtain a higher loan amount at the renewed and lower rate of interest.
III. Modified Repayment Tenure:
When transferring the loan from one bank to another, you could always negotiate the existing repayment tenure. Depending on your comfort and repayment capacity, you could extend or shorten the tenure. With an extended tenure, you would have lower EMIs to pay, and with a shorter tenure, your overall interest burden would shrink – a win-win situation at any rate!
IV. Better Features & Services:
If you are not happy with the services offered to you by your current bank, or feel that the services provided by your new potential lender are better and more diverse, you should seriously consider transferring your personal loan to the latter. This way, you can get to enjoy a whole new array of exciting features and benefits.
Personal Loan Balance Transfer with IndusInd Bank
A Personal Loan Balance Transfer with IndusInd Bank is a great option for those looking for attractive interest rates to save more money on repaying their personal loan.
IndusInd Bank follows a simple loan transfer process, requiring no physical documentation.
Most important, you are given access to a top-up facility on your existing loan, ensuring that your extra credit needs, if any, are promptly met from the moment you choose to bank with us. With complete digital application and impeccable customer service, your banking journey with IndusInd Bank is bound to be rewarding and fulfilling.
Ready to transfer your personal loan? Apply at IndusInd Bank today!
Disclaimer: The information provided in this article is generic in nature and for informational purposes only. It is not a substitute for specific advice in your own circumstances. Hence, you are advised to consult your financial advisor before making any financial decision. IndusInd Bank Limited (IBL) does not influence the views of the author in any way. IBL and the author shall not be responsible for any direct/indirect loss or liability incurred by the reader for taking any financial decisions based on the contents and information.
