Loan Balance Transfer: Before transferring the balance of personal loan, know these things, the burden of EMI will be reduced

If you have already taken a loan, but now you are facing difficulty in paying its EMI, then such a situation can bother you a lot. But there is a way to avoid this, which is you can transfer your loan balance with a lower interest rate. It is a type of financial solution in which the burden on the lender is reduced. But is it right to transfer the balance or does it have some disadvantages? Let’s know about it.

Loan Balance Transfer: Before transferring the balance of personal loan, know these things, the burden of EMI will be reduced

What is Personal Loan Balance Transfer?

Before delving into the pros and cons of a personal loan balance transfer, it is important to know what it is. Just like its name, it enables you to transfer your outstanding loan to another loan with lower interest rates. This reduces the burden of loans. Also, the loan provider pays an additional amount over and above the outstanding loan amount.

Who can transfer

Certain criteria need to be met to transfer the personal loan balance.

The age of the applicant should be between 21 to 61 years.

The applicant must be a salaried employee of a public or private company whose minimum turnover meets the criteria.

You must have at least 6 months of work experience in the company you are currently working for, and at least 1 year of work experience.

A CIBIL score of 750 and above can help in getting the transfer done without any hassle.

Benefits of loan balance transfer

No doubt transferring loan balance comes with a lot of benefits, some of which are as follows-

The first benefit is in the form of low EMI. The reduction in the interest offered by the banks reduces the EMI.

Choosing a low-interest loan provider maintains transparency in costs like processing fees, transition fees, etc.

With the facility of a top-up loan, people do not face financial constraints and get the option of extending the repayment period. This helps in paying small installments without any compromise.

Loan Balance Transfer: Before transferring the balance of personal loan, know these things, the burden of EMI will be reduced
Loan Balance Transfer: Before transferring the balance of personal loan, know these things, the burden of EMI will be reduced

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It is important to keep these things in mind while transferring

If you are going to transfer the loan balance, then it is important to take care of some important things. Sometimes borrowers opting for loan balance transfer opt for a lower rate of interest but end up with a longer tenure. Also, many times banks only focus on the low-interest rate. So, don’t read the terms and conditions thoroughly. Keeping all these things in mind, if you opt for a loan balance transfer, then it can benefit you.

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