Have you taken a Personal Loan from a lender?
Loan management is an essential part of financial management. If you’re not actively taking care of your loans and finding the best credit offers, you may be losing a ton of money. A Personal Loan balance transfer is a little-known feature that can help you save a lot of money on interest payments.
In this article, we’ll cover everything you need to know about it.
A Personal Loan Instant Transfer occurs when a borrower transfers their outstanding loan amount to a different lender.
For example, Pritam borrowed Rs 1 lacs from Lender A at an interest rate of 12%. He paid back Rs 25,000 of the loan to Lender A. Then, he came across an offer from Lender B for Personal Loans at an interest rate of 9%. He decided to transfer his loan from Lender A to Lender B to take advantage of the lower interest rate.
Essentially, a Personal Loan balance transfer replaces your current lender with a new one. When you opt for a Personal Loan balance transfer, your new lender will pay the remaining money to your old lender, and then you repay the new lender.
In this process, you will need to incur certain additional charges such as the loan processing fee of the new lender and any penalties and charges that the old lender may charge for discontinuing their loan. However, the advantages of a Personal Loan balance transfer may outweigh these costs.
There can be several reasons for a Personal Loan balance transfer.
The most common reason for a Personal Loan bank transfer is to take advantage of a lower interest rate being offered by a different lender. Not all banks lend at the same interest rate.
Further, the interest rate for a Personal Loan can change from time to time. Hence, it is always advisable to keep looking for the best interest rate being offered in the market.
However, only borrow from credible organizations and banks and do not trust unknown lenders even if they offer a better rate.
Sometimes, you need a longer period to pay off a loan. You may have miscalculated your budget, or your financial situation may have changed. In such circumstances, you can talk to your lender and ask them to extend the period of your loan. However, a lot of times, the lender may refuse to extend the tenure of your loan.
In such circumstances, you can find a different lender who is willing to take on the loan at a longer repayment tenure. You can apply to them for a loan transfer and avail of the longer tenure (and lower monthly payments).
Some lenders offer better features when compared to other lenders. Suppose your old lender only operated through their branches and did not have net banking features. You would want to switch to a more modern lender. Hence, you can apply for a loan transfer to the new lender to take advantage of their features. Some of these features can include
Getting a Personal Loan instant transfer is a simple process and can be accomplished within one week.
That’s all. You have successfully made a Personal Loan balance transfer.
Different lenders have different eligibility criteria, but most of them are similar. The list below is indicative and not exhaustive.
Here is an indicative list of the documents that you may need for a Personal Loan instant transfer:
Opting for a Personal Loan balance transfer can be a good idea under several circumstances including a lower interest rate or longer repayment tenure. The process of availing of one is quite simple, and all you need to do is get in touch with your current lender to get started. Visit Poonawalla Fincorp to avail best offers and check your eligibility for the same.
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