In case, your CIBIL score isn’t up to the desired mark, but all the other factors are in your favour, the lender might consider offering you the loan, albeit at a comparatively higher interest rate.
To avoid this hindrance, you should try paying off all other loans with the exception of your Home Loan before applying for a refinance facility.
Cost You’ll Incur
When it comes to Home Loan refinancing, not only does your existing bank charges a foreclosure fee, but you also need to pay the processing fee to your new bank. The prospect of getting a new client is sure to incentivise even the banks with the Best Home Loan offers to provide you with additional discounted rates.
When you get your loan refinanced with a new lender and start paying lower interest, then your overall outgo towards the interest component in a given financial year subsequently reduces.
Considering that you are already servicing a Home Loan, we consider it safe to assume that you know the difference between a fixed-rate Home Loan and a floating rate Home Loan.
This is essentially one of the most overlooked aspects. That being said, a Home Loan refinance can prove to be immensely beneficial for you, especially if you are in the initial phase of your loan repayment, as it might help you save a large chunk of money over your tenure.