Go for the home loan balance transfer option –

HLBT or home loan balance transfer option permits you to shift your outstanding loan proceeds to another lender at a lower rate of interest.. Opting for the same EMI might permit you to close your home loan simply than the original loan. However, before opting for the home loan balance transfer option, ensure to compute on the SBI home loan EMI calculator, or LIC home loan EMI calculator, your overall savings, and the appropriate repayment tenure as per your cash flow. 

When should you opt for the home loan balance transfer option?

Transferring your home loan balance in the starting years of the repayment tenure will assist you in deriving higher savings on interest costs. The EMIs during the starting years consist of the interest constituent. Consider going for the repayment tenure extension only if you are aiming to reduce your EMI. 

Opt for the home loan prepayment option whenever possible

When you make the home loan prepayment partially, get an option to either lower the repayment tenure or loan EMI. In such cases, opt for the repayment tenure reduction while keeping your loan EMI the same as before. Lowering your repayment tenure will lead to higher savings on overall interest payout while lowering your home loan EMI tends to lower your burden on EMI. You as a borrower if you are comfortable making the payment of your prevailing home loan EMIs must ensure to go for the repayment tenure reduction option. 

Borrower must ensure to try and make the home loan prepayment whenever you get surplus funds. Thus, prepay home loans just when you hold adequate funds after, factoring in exigency funds, and monthly contributions as investments to attain your important goals and other liquidity-linked requirements. 

Also, you as a home loan applicant tend to factor in taking up a home loan overdraft deal to make the most from prepayments while maintaining your liquidity. Home loans available with an overdraft option permit you to deposit your surplus funds in the attached overdraft account, which may either be a current or savings account.

Also Check: LIC Home Loan EMI Calculator

Go for the home loan variants providing increasing EMIs

Out of all kinds of loans available in the market, home loans come with one of the highest repayment loan tenures. Most lenders generally provide a home loan of as high as 30 years. In case you expect your income to enhance with time, try increasing your loan EMI gradually. There are various home loans lenders like HDFC bank and ICICI bank that endow flexibility to you as a customer to enhance your home loan EMI each year in proportion to a rise in your income, thus assisting you to repay your home loan quickly. Such a facility even enhances your eligibility as a home loan applicant as in such cases the lenders even consider your future earning potential of you as a borrower. 

There’s nothing more overwhelming as compared to paying your whole home loan for becoming an extremely proud homeowner. While you may celebrate the closure of your home loan deal, note to understand all the important aspects linked with home loan closure.

Collection of all the original documents

Initially, you must ensure to collect all original documents you have provided the home loan lender while opting for the home loan deal. These documents include – 

• Title deed

• Sale deed

• Power of attorney

• Loan Agreement

Also, ensure the documents you collect are in good condition. In case, if any document is missing, ask your home loan lender to hand over the same. So, one of the points you must ensure to do after you have cleared your home loan is, to collect all the original documents. This is important and must be prioritised. 

The post Read On to Understand Some Crucial Tips to Close Your Home Loan Early appeared first on New Lease On Life.