Documents for a home loan balance transfer
To ease your home loan balance transfer process, here is an extensive list of documents required. The list comprises of every document that will be required from the beginning to the end of the procedure. Since, there are two lenders involved in this process, you will have to collect certain documents from your existing lender and submit them to your new lender.
List of documents you will require from your existing lender
- Letter of consent
You need to submit a formal application to your existing lender informing them about the home loan transfer and ask for a consent letter.
- No Objection Certificate
A ‘No Objection Certificate’ or an NOC states that your existing lender has no issues transferring your home loan to the new lender.
- Foreclosure letter
Finally, a foreclosure letter stating that your home loan is foreclosed on the stated date and no outstanding balance is left. This letter will be obtained once your new lender pays your outstanding loan amount to your existing lender.
- Home loan statement
Collect a statement of the home loan displaying your EMI repayment track record. This statement will also have the outstanding loan amount.
- Property documents
You will need to collect your property-related documents from your existing lender.
- Post-dated cheques
You must have submitted post-dated cheques while taking a home loan. Make sure to collect the pending cheques.
Documents you need to submit to your new lender
1. KYC documents
This is for the verification purpose of your identity. You will have to present at least one document from the below mentioned list:
- Voter's ID
- Driving license
- Job card issued by NREGA
- Aadhar card
- PAN card (PAN card only as identity proof)
2. Address proof
This is to verify your address details. You will have to present at least one document from the below mentioned list:
- Voter’s ID card
- Driving license
- Aadhar card
3. Financial documents
This is to verify your repayment capacity and income source. You will have to present the following documents:
- Form 16
- Latest salary slips
- Bank statements of salary account for the last six months
4. Property-related documents
This is to verify the purchase of your property. You will have to present the following documents:
- Property purchase documents or documents that prove the ownership of the property
- NOC from your developer/housing society
- Registration, stamp duty payments
5. Documents of your existing home loan
This is to verify your existing loan details and that your lender has no objection in transferring your home loan. You must collect these documents from your existing lender and present them to your new lender:
- Your loan sanction letter or loan agreement with the existing lender
- Approvals from your existing lender (Letter of consent, NOC, Foreclosure letter)
- Home loan statement till date
If all the above-mentioned documents are in place and verified, your balance transfer process will be smooth.
Make a note of this checklist of documents and start collecting them if you wish to take advantage of the balance transfer facility.
Frequently asked questions
Transferring ownership of a home loan involves the following steps:
- Check mortgage terms for transfer restrictions.
- Inform the lender and receive their instructions.
- New borrower qualifies and completes an application.
- Submit required documents like income verification and credit history.
- Lender reviews and approves the transfer if criteria are met.
- Legal documents may be needed for ownership and mortgage transfer.
- Closing might occur with both parties signing.
- Pay applicable fees and costs.
- Lender updates records with new borrower's info.
- Property title changes may be required. Remember, not all mortgages are transferable, and lender approval is crucial. Legal requirements vary, so consult professionals for guidance.
Home loan balance transfer or refinancing is a common strategy to consider if you are looking to reduce mortgage costs. However, the decision should be based on careful consideration of your individual financial circumstances, goals, and the potential benefits and costs associated with refinancing.
Here is the criteria for home loan balance transfer:
- You must be an Indian citizen residing in India.
- A salaried applicant must be between 23 years to 65 years, and a self-employed professional must be between 23 years to 75 years. *The upper age limit is considered as the age at the time of loan maturity.
- Your CIBIL score should be 725 or higher.
- And you can be a salaried professional, self-employed professionals like doctors and self-employed non-professionals are eligible to apply.