Taking home loan for buying a house is very easy but to manage your home loan properly is a difficult task. You need to update yourself with current rate of interest on home loan which are being offered in the market, calculate your savings if you opt for balance transfer of your home loan, etc.
There are a number of reasons to refinance your home loan but it makes sense to refinance only if the savings after refinance offsets the cost of refinance. Some of the chief reasons to go for refinancing your home loan are outlined below:
This is the primary reason to refinance your home loan. For this purpose, you need to check as to what is the interest rate of your existing home loan and what is the interest rate that other banks/ NBFCs currently offering. If the interest rate that you are currently paying is significantly high then you must go for refinancing.
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If you want to shorten the tenure of your original loan and existing lender is not agreeing for the same then you have to look for refinance your home loan with a different lender who is ready for refinancing your existing home loan.
In case you want to change the type of interest from fixed to floating at lower rate of interest or vice versa, and your current lender is not ready to provide this facility on the existing loan that you have taken, then you can consider for refinancing your home loan.
If you want to switch to flexi payment option for EMI which is not being offered by your current lender, then you may think of refinancing your home loan.
Before opting for refinance of your home loan, you must consider following points for sure:
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