Few things to remember while transfer your Home loan to another Bank

In the last couple of months all the Banks reduced their rate of interest on Home loan and offer the home loan with attractive rate of interest for fresh borrowers & for existing customers also. As a result many existing home loan borrower want to switch off their home loan to another bank.

But before transfer your home loan to another bank you have to remember few things

1. While transfer your home loan to another bank you have to check the processing fees for loan would be charged by the new bank, it is in the range of 0.5% - 1% of the total loan amount
2. In balance transfer of home loan, you have to check the prepayment penalty charged by the bank. This may range between 1% - 5% of your loan amount
3. Transfer your home loan to another bank only when there is a difference of 1.5% - 2% in your current rate of interest ,if you are getting only the reduction of half percent in the existing interest rate than balance transfer is not a good option
4. Before transfer your home loan you have to check what all banks rate of interest because most of the bank offer the lower rate of interest for a small period –about one year and these loans are based on floating interest rates, and bank may change the interest rate at a later stage and you have to pay the interest rate according to that

So before switching your home loan to new bank do check the loan amount, interest rate offered by the banks and what other charges bank may charge from you .Do take care of all these things while going for a balance transfer.