When a balance transfer is worth it
- Rate difference is at least 0.5% (ideally more).
- You have several years of tenure left — early in the loan, where interest is heaviest.
- The break-even point (switch cost ÷ monthly EMI saving) lands comfortably within your remaining tenure.
No exit penalty: closing your old floating-rate home loan to switch carries no foreclosure charge for individuals under RBI rules — so only the new lender's fees matter. Why →
Watch the total cost, not just the rate
A lower rate with a high processing fee can erase the benefit. Always check the net saving and break-even — both shown above. Also avoid resetting to a longer tenure unless you specifically want lower EMIs.
Have spare cash too? Compare prepaying or investing it.
General information, not financial advice. Illustrative figures. Last updated June 2026.