RBI has increased the repo rate several times and its direct effect is visible on the banks’ interest rates. Due to which now banks are increasing the interest rate on fixed deposits, savings accounts and loans. If you have taken a loan from a bank then you will also have to pay more interest. So to avoid such situation you can transfer the loan to another bank. But there are some things to keep in mind while transferring the loan. So let’s know how you can get double benefit by saving money on interest.
How to choose a bank for loan transfer?
You should check the interest rates of all home loan banks before transferring to another bank. Then you choose the bank that has the lowest interest rate. Then contact the branch of the bank from which you have taken the loan. Where you can submit your loan transfer to another bank. After completing this process, you can easily transfer your loan.
Pay special attention to these things.
To transfer the loan, you have to apply for foreclosure in the bank from which you have taken the loan. Account statement and documents from the bank from which the loan has been taken must be taken and deposited in the bank to which the loan is to be transferred. Apart from this you also have to take NOC from the bank from which you have taken the loan. Which has to be deposited in the bank where you want to transfer the loan. Importantly, the bank charges a one percent processing charge for this process.
What is the benefit of doing this?
If the loan is transferred to a bank with a lower interest rate, your installment will be lower than before. You can also save extra every month as you have to pay less installments. The bigger the loan, the bigger the savings. So you can invest this extra savings in a good scheme and get a good return. By doing this, you get a double benefit as the installments are reduced and you can get good returns by investing these savings.