Be it a great business idea, emergency situations, dream weddings or any given purpose, Personal Loans (for those with a good credit score) are one of the best financing solutions.
Personal Loan Balance Transfer – How it works?
If you have borrowed funds from a financial institution at a higher interest-rate, a Personal Loan Balance Transfer is an effective solution to lower your overall interest cost.
Personal Loan Balance Transfer is a process to transfer your entire outstanding loan amount from one bank to another. Your new lender pays off the entire outstanding debt to your existing lender and all your future EMI obligations are now transferred to your new lender. A lower interest rate helps you save big on your overall interest outgo resulting in a reduced EMI burden.
Reduce the burden of your existing loan with ICICI Bank Personal Loan Balance Transfer
A borrower should evaluate the prospects of a balance transfer before taking a decision as there might be several additional costs associated. However, in most of the cases, it works out in favour of a borrower as the savings from interest outgo far outweigh the associated costs.
This is an ideal situation for borrowers where a new bank usually extends a Personal Loan facility at a lower interest rate eventually reducing the overall interest burden for the borrower.
Let’s understand this with an example:
| Existing Loan | Balance Transfer with ICICI Bank | |
|---|---|---|
| Principal Outstanding / Balance Transfer Amount | Rs 5 lakh | Rs 5 lakh |
| Rate of Interest (per annum) | 14.50%* | 11.25%* |
| Tenure | 48 months | 48 months |
| EMI | Rs 13,789 | Rs 12,984 |
| Monthly Reduction in EMI | - | Rs 805 |
| Total savings from overall interest outgo | - | Rs 38,640 |
As depicted in the above example, you can easily benefit from a personal loan balance transfer even after considering additional costs such as foreclosure charges, loan processing charges, stamp duty on agreement, etc.
The benefits of transferring your Personal Loan to ICICI Bank include:
- Attractive interest rate: Personal Loans from ICICI Bank start as low 10.85% per annum resulting in great savings and a reduced interest burden on your existing loan. Further, the interest rate stays fixed for the entire tenure of your loan.
- Easy transfer: With minimal documentation and quick approvals, all you need to do is file a balance transfer application.
- Flexibility: ICICI Bank offers you complete flexibility when it comes to transferring your Personal Loan. You can easily avail a Top-Up loan over and above your existing outstanding principal that directly gets credited to your bank account. You can also extend your tenure and benefit from a higher disposable income to fulfil the dreams of your loved ones early.
So, what is it that you’d rather prefer – savings or higher interest cost? Undoubtedly, Personal Loan balance transfer is a good refinancing option. Transferring the balance in early stages of your loan (when the interest component is high) can help you save a good amount money. But always remember to pay attention to the fore-closure charges and other related expenses before taking a decision.
Apply for an ICICI Bank Personal Loan Transfer today.
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