With the current fluctuation and competitive market all the Banks/ NBFC’s try to acquire and retain new and existing customers with the best available market interest rates. After borrowing and successfully running a home loan for few years, we at times look for better alternatives to reduce the EMI or interest rates or other terms and conditions. When home loan applicants look for other alternatives to opt for low interest rates prevalent in the market, this is called Balance Transfer of Home Loan. An existing borrower may ask the Bank/ NBFC to lower the present interest rates and the lender denies, the borrower may move to a new lender who is ready to charge low interest rates against the present home loan. But Internal Balance transfer is different.
There may be a situation or an emergency when you have to sell your property (the property against which you took the home loan) to generate funds. The new buyer of the same property also wants to borrow the home loan from your lender. This is called Internal Balance Transfer of Home Loans. The following points will help you to know more about the sanctioning norms of the internal balance transfer of home loans.
Yes, it is important. Legal verification is done because the the property will be owned by the new owner. The ownership is transferred from one hand to another, so the marketability and the viability of the property papers become mandatory for the Bank/ NBFC. The technical verification is done to verify the market value of the property. The lender has to stick to the Loan-to-Value (LTV) ratio norms even for the new borrower.