How much can you save with a loan against property balance transfer?

Transferring your Loan against Property (LAP) balance to another lending institution for a lower interest rate can lead to good savings. How much you save precisely depends on a few key points:

1. The difference in interest rates: Even a small 1-2% rate drop can reduce your Equated Monthly Instalment (EMI) by thousands of rupees monthly over a long tenure.
2. How long is left on your loan: More years means more interest savings when switching loan providers.
3. Fees charged for the transfer: Account for legal charges, processing fees, etc., to calculate the net benefit.
4. Flexibility to prepay after transfer: Some loan providers allow you to close the loan early without charges, which helps reduce the total interest paid.

For instance, If you have a ₹50 lakh home loan balance left to pay over 10 more years, and your current interest rate is 11%, transferring to a lending institution charging 9% can save you several lakh rupees in total interest over those 10 years. Carefully calculate the potential savings versus any transfer fees to make the best choice.