The facility that is offered by various banks and financial institutions to transfer the outstanding principal amount to another bank or financial institution is known as a balance transfer. The interest rates of balance transfer begin from 8.90%p.a. whereas the reimbursement tenure varies between 12-17 every two months. A balance transfer is out there for every kind of loan, together with personal loans. A balance transfer is also done to acquire the benefits of better interest rates and other features.
|Bank||Interest Rates||Repayment Tenure|
|ICICI Bank||11.29% onwards||12 to 60 months|
|HDFC Bank||15.50% to 21.50%||12 to 60 months|
|Canara Bank||11.00% onwards||Up to 60 months|
|Kotak Mahindra Bank||10.99% to 24% p.a.||12 to 60 months|
|IndusInd Bank||10.50% onwards||12 to 60 months|
|Axis Bank||8.90%||12 to 60 months|
|State Bank of India||11.95% onwards||Up to 72 months|
|Bank of Baroda||As per the applicant’s risk rating||Up to 48 months|
|Indian Overseas Bank||11.90% onwards||Up to 60 months|
|Corporation Bank||12.85% onwards||Up to 60 months|
Loan Top-up and Balance Transfer
You can also ask the new lender to offer you top-up on your new loan while doing a balance transfer to your new lender. You are going for the loan top-up then you should choose a loan that is greater than your outstanding balance. Once you will fulfill the eligibility requirement then your new lender will give you approval for the loan. And then the top-up amount will be credited to you shortly.
Let’s assume, you are transferring the outstanding balance of Rs.4.3 lakh. In this situation, you should apply for a loan of Rs.6 lakhs. Once you complete that, your new lender will transfer the 1.3 lakh to your bank account. The remaining balance will be given through a cheque so you can reimburse the outstanding payment. This means that when you do the balance transfer, your total undone balance will be Rs. 6 lakhs plus interest.
Features and Benefits of Personal Loan Balance Transfer
- Extended Loan Tenure
When you will do a balance transfer, you will be dealing with the new lender, with that every terms and condition will also be changed. Hence you can change the tenure of the reimbursement according to your budget.
- Enhanced Interest Rates
When you are going for a balance transfer on your personal loan, it is just because the new lender is offering you the lower interest rates. And thus, the burden of the EMI will get decreased.
- Better Features
By choosing to refinance your personal loan will help you to get better deals from the new lender that can be in the form of low-interest rates, low processing fees, etc.
- Augmented Loan Amount
A balance transfer is de facto helpful once the loan quantity you availed at first isn’t up to fulfill your monetary necessities and your existing loaner doesn’t enable you to
take a top-up loan.
Why You Should opt for Balance Transfer on Your Personal Loan
Balance Transfer on your personal loan is a good idea if;
- You want to choose a new lender who is giving you good deals on your personal loan.
- Your income has increased and now you can pay off the loans fast by paying frequent EMIs.
- Based on your credit score, the new lender is ready to offer you better deals because there is an improvement in your credit score.
- You want to increase the tenure of the repayment because of the higher EMI.
- You want to remove or to add the co-applicant on your personal loan
Eligibility Criteria for a Personal Loan Balance transfer
The Eligibility criteria for a personal loan balance transfer is the same as personal loan and sometimes it varies from lender to lender. But there is a basic eligibility criterion for a personal loan balance transfer is:
- The person who is employed in private companies or government agencies.
- A person whose age must be in between 21 years to 60 years.
- A person who has a total work experience of 2 years and out of which one should be with the current employer.
- A person must have a monthly salary income of Rs 15000.