Home loan balance transfer: Higher residual principal tenure drive savings

A high credit score is critical as it enables the borrower to secure the new loan at an attractive rate

The Reserve Bank of India cut the repo rate by 25 basis points on December 5. The cumulative rate cut of 125 basis points in 2025 has brought the repo rate down to 5.25 per cent. Queries for home loan balance transfer (HLBT) have spiked after the latest cut.

 

Conducive environment

 

Lower interest rates typically benefit new borrowers faster than existing ones. “Many existing borrowers are still waiting for a full transfer of benefits from their lenders,” says Atul Monga, chief executive officer (CEO) and co-founder, BASIC Home Loan. 

Balance transfer becomes attractive when rates are competitive and trending lower.