It is a widely known fact that personal loan interest rates are generally higher than other secured loans such as Gold Loan, Loan Against Property, Loan against FD, etc. One of the reasons behind this is lenders don't ask for any kind of security against the loan amount. Several individuals look to save a substantial amount when going for a personal loan. But do you know how to ensure maximum savings if you already have a personal loan and how to choose HDFC Personal Loan Interest Rate?
Well, if you already have a personal loan and want to ensure savings on your interest and EMI amount, the Balance Transfer Facility can be the right option for you. You must be thinking what exactly this facility does? Well, first of all, among the several methods out there to save, this method is a quite popular one. With a Personal Loan Balance Transfer Facility, an individual can transfer his or her outstanding principal amount to some other lender at a lower HDFC Personal Loan interest rate. Want to know more about it? Well, in this article, we will discuss the same along with an example so that you can understand better. Keep reading to know more! Role of HDFC Personal Loan Interest Rate in the Balance Transfer Facility A lot of people complain about the higher interest rates on their personal loans. One of the reasons behind this is they didn't remember to look for options when choosing the rate for them. Due to the higher interest rates, individuals find difficulty in repaying the monthly installments. So, what's the solution for this? Well, with Personal Loan Balance Transfer Facility, individuals can ensure the maximum savings as well as repay the EMI easily. Lenders allow individuals to allow a Balance Transfer facility with a few conditions. First of all, the credit score must be good which is considered to be 700 or above. For example, if an individual wants to transfer his outstanding principal balance to HDFC Personal Loan Interest Rate, HDFC Bank will check if he has a good repayment behavior. Since he is choosing a lower personal loan interest rate, the EMI would automatically be lower than before. During this whole process, the individual would be able to save a substantial amount. One thing you also need to remember that lenders also charge a One-time Processing fee on the Balance Transfer facility. This fee generally depends on the outstanding principal balance. Now, let's understand how much an individual can save with the Balance Transfer facility with an example. Suppose an individual has a 5-year personal loan of INR 4,50,000 at an interest rate of 19.50% per annum. For this amount, he must be paying an EMI of INR 11,797 with an interest outgo of INR 2,57,844. Now, after two years, he wants to switch to a lower HDFC Personal Loan Interest Rate of 14.30% per annum so that he can transfer his outstanding principal balance to HDFC Personal Loan Facility. At this time, his principal balance was INR 3,19,632. For this amount, the new EMI amount will be INR 19,971 and the interest outgo will be INR 75,320. As you can see that the new EMI amount is quite lower than the previous one which indicates that when you are choosing a lower HDFC Personal Loan Interest Rate, you can easily save money. Similar to the EMI amount, you can save on interest too. This is why individuals choose to opt for a Balance Transfer Facility. Some of the other methods to ensure maximum savings on a Personal Loan are Prepayment Facility, Choosing a Lower Interest Rate, Shorter Tenure, etc. You can calculate all the savings with the help of the HDFC Personal Loan EMI Calculator without any stress. Just put a few details into it and you are good to go.
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Anika Sharma
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