Sometimes, after availing a home loan, borrowers feel their lenders are levying higher charges, such as higher-interest rates, prepayment penalties, poor customer service etc. In such cases, refinancing their home loan is a good idea.
A home loan balance transfer or refinancing a home loan is an excellent way to reduce home loan liabilities. You may also think about refinancing your loan if a lender offers lower interest rates or better terms. This article elaborates upon five reasons why refinancing can be the best decision for you:
Why Refinance Your Home Loan?
#1: Save More with Lower Interest Rates
Lenders offer the best deals to new borrowers. So, if you are an existing borrower, your lender may not offer the same benefits to you. Therefore, transferring or refinancing your home loan is wise in such cases.
Remember, even a 0.5% reduction in home loan interest rates can help you make a windfall gain. PNB Housing is known to offer some of the lowest home loan interest rates in the industry. The rates range between 8.00% and 10.50%, helping you save more.
#2: Become Debt-Free by Reducing the Loan Tenure
If you’ve taken a home loan for a long tenure and your financial situation has improved, consider refinancing it with a shorter tenure to save on EMIs and shed the ‘debtor’ tag faster. Generally, Financial Institutions allow you to part prepayment of loan as & when you want. Financial institutions
generally give an option to change your tenure / EMI. Else, you can always go for refinancing or balance transfer.
Refinancing a Home Loan can help reduce your loan term by increasing the EMI amount. If the rates offered by the new lender are lower than your existing lender, you can repay the loan much earlier than the original term and enhance your credit score.
Must Read: Fixed Vs Floating Interest Rate: Which Is Better For Home Loan?
#3: Change Your Lender to Get Better Service Quality
Sometimes, borrowers complain their lender is not customer-friendly. The customer care executives and company officials lack empathy, have poor communication skills, or are inflexible. Moreover, some lenders do not offer flexible payment options or charge higher fees.
#4: Get More Money
House construction or purchase is a costly endeavour and the risk of cost escalation is always high. You can apply for a home loan refinance if your existing lender refuses additional funds.
Before seeking extra funds from a lender, you must use a home loan eligibility calculator and check whether your monthly income permits the additional burden or not. PNB Housing provides a free home loan EMI calculator on its website to simplify your task of calculating your monthly liabilities.
Conclusion
Refinancing a Home Loan is an excellent way to reduce liabilities and get more benefits. Ensure you check the refinance fee and cost before submitting your application. Choose a reliable financial institution like PNB Housing and get the lowest interest rates, longer tenures, and more responsive customer support. Contact PNB Housing representatives for refinancing today. Make sure you have all the documents required for a home loan refinance handy to expedite the transfer.
