About Punjab National Bank
Punjab National Bank (PNB) is one of the leading Nationalised Banks. The Bank offers various retail and corporate products and services. The Home Loan is one such retail product offered by the bank. Punjab National Bank Home Loan is very popular for various reasons. If you are intending to make this huge investment in purchasing or building a house considering a Home Loan from Punjab National Bank would be ideal. The advantages of availing loan from this bank are:
- The rate of interest starts at as low as 8.60%
- Quick processing and easy documentation
- No hidden charges
- Nominal processing charges and pre-closure charges
- An overdraft facility over and above the housing loan will be provided to the extent of 25 Lakhs which can be used for personal purpose. The loan-to-value (LTV) of both the housing loan and the overdraft put together should not exceed 80% in case of a loan availed for purchase/construction of a house and 75% in case of a loan availed for purchase of a flat.
- The maximum repayment period is 30 years for the term loan part and the overdraft facility should be renewed every year.
What is a Home Loan Balance Transfer?
A Home Loan Balance Transfer or HLBT is a process wherein the unpaid principal balance of the existing Home Loan is transferred to another bank/financial institution for a lower rate of interest. This is one of the ways to reduce the cost of the loan. The other way would be to negotiate with the existing banker/financial institution for a better rate. There are so many players in the market providing very competitive offers. Before deciding on the bank/financial institution for a Home Loan Balance Transfer, thorough market research is essential to get the best benefit out of the balance transfer.
Who Should Go for Home Loan Balance Transfer?
While availing a loan for a huge investment like a Home Loan it is essential to compare the offers available in the market. If you have availed a Home Loan without going through the ordeal of comparing the offers you might have taken a loan at a much higher interest as compared to the other offers available in the market.
If at any point in time you have realised the fact that you are paying a higher rate of interest or the loan tenure is not as flexible as what is available in the market or if you are facing problems with the services offered by your existing lender, then you can consider Home Loan Balance Transfer to a new lender who is offering you the best deal.
However, before taking a decision regarding the balance transfer you should also consider the following:
- What is the residual repayment period available? If the Home Loan maturity period is almost nearing then it is not advisable to go for a balance transfer considering the other charges that will be involved for the balance transfer. On the other hand, if the tenure remaining is long enough then you can consider the transfer of Home Loan balance.
- If a major portion of the Home Loan is outstanding then it is advisable to consider the Home Loan Balance Transfer. Even here you should compare the different rates offered by other financial institutions/banks. If the difference is more than 25 basis points and a major portion of the existing Home Loan is outstanding, then it will be profitable to go for a Home Loan transfer. On the contrary, if more than 70% of the Home Loan is paid off and the rate difference is between 5 to 25 basis points then it is recommended to continue the loan with the existing lender.
- Before considering a Home Loan Balance Transfer, it is prudent to do a cost-benefit analysis. You should take into account the foreclosure charges that the existing lender will be charging and the processing charges that the proposed lender will be charging along with the savings in respect of the interest rate to arrive at the actual benefit.
- You should even consider the benefit of top-up loans that will be offered along with the Home Loan Balance Transfer. The top-up loan can be beneficial as it can be used to clear any high- cost loans you would have availed apart from the Home Loan.
Features of PNB Home Loan Balance Transfer
The following are the features of PNB Home Loan Balance Transfer:
- The rate of interest starts at 8.60% p.a.
- The maximum loan repayment period is 30 years
- Processing charge is up to 0.35% of the loan amount with a minimum of 2,500 and a maximum of 15,000.
- Collateral security by way of mortgage of the property for which the Home Loan Balance Transfer is availed.
- Margin is set between 20% to 25%
Benefits of PNB Home Loan Balance Transfer
The following are the benefits of PNB Home Loan Balance Transfer:
- No charges for part payment and pre-closure of the loan
- No hidden charges
- Simple documentation and quick processing of the loan
- A guarantor is not required for the Home Loan
- A fixed rate of interest option available with a competitive rate
- Doorstep service available
Eligibility for PNB Home Loan Balance Transfer
The following are the eligibility criteria for PNB Home Loan Balance Transfer:
- The applicant should be in the age group between 21 years to 65 years
- For salaried individuals, the work experience should be a minimum of 2 years in the present employment.
- For self-employed individuals/professionals and businessmen, their existence in the present business should be at least 5 years.
- The minimum income required is 25,000 p.m.
- Either the spouse, children or the parents with a stable income can be co-applicants for the loan and their income can be considered to arrive at the eligible loan quantum.
Documents Required for PNB Home Loan Balance Transfer
The documents required for PNB Home Loan Balance Transfer are:
- Application form for Home Loan balance transfer duly filled
- Proof of Address like Aadhar card, Voter's ID, Driving Licence, Passport, and Utility Bills (anyone)
- Photo Identity Proof like PAN Card, Aadhaar Card, Voter's ID, Driving Licence, and Passport (anyone).
- Salaried individuals should provide their latest Salary Slips and Form 16 for income proof.
- Self-employed individuals/professionals and businessmen should provide 3 years IT Returns and Financial Reports like balance sheet and profit and loss statements as income proof.
- Bank Account Statement for at least the past 6 months
- If having loan accounts other than the Home Loan, then 6 months pass sheet of the loan account should be provided.
- Two passport size photographs of the applicant which should be self-attested
- Copies of the property documents for which the loan is being availed
- No objection letter/ consent letter from the existing lender should be submitted.
Process for PNB Home Loan Balance Transfer
There is a process to be followed for availing the Home Loan Balance Transfer facility. The details of the process are as illustrated below:
- A loan closure request has to be given to the existing lender with the reasons for pre-closure of the loan. You can place a request in the form of a letter if there is no specified form for a request for loan pre-closure. In case there is a specified application form, then ensure filling the form accurately.
- The existing lender will issue a No Objection Letter or will give a consent letter for taking over of the loan if the reasons given for pre-closure of the loan is convincing. The NOC or Consent Letter forms a part of the documents that have to be submitted to the new lender along with the request for a Home Loan Balance Transfer.
- The next process is to approach the new lender of your choice and apply for the Home Loan balance transfer. You will have to submit the relevant application form along with the documents required by the new lender. The documents could be Photo ID proof, Proof of Address, Income Proof, Bank Account Statement, Photographs and the NOC from the existing lender along with the outstanding principal balance in the existing account. Income proof for other than the salaried class will be the financial reports like the balance sheet, Profit and Loss Account Statement and Income Tax Returns.
- The existing lender will give a confirmation of the closure of the account on completing the process.
- The regular loan processing and appraisal will be done by the new lender and on approval of the loan.
- The next step will be the execution of the loan documents with the new lender. The outstanding balance will be taken over by the new lender and the equated monthly instalment (EMI) towards the loan should be paid to the new lender henceforth.
Charges on PNB Home Loan Balance Transfer
Given below are details of charges levied on PNB Home Loan Balance Transfer:
|Type of Charge||Details|
Starts at 8.60% p.a.
Up to 0.35% of the loan amount with a minimum of 2,500 and a maximum of 15,000
Charges for loan statement
200 per instance
Overdue penal interest
2% p.m. on the overdue amount for the overdue period
Loan pre-closure statement
Part-payment and pre-closure charges
Nil for floating interest rate loans
Contact Numbers for PNB Home Loan Balance Transfer
For queries regarding the PNB Home Loan Balance Transfer you can contact the customer care helpline on the following numbers:
Toll- Free Numbers:
24 X 7 Customer Care Numbers:
You can also send an SMS 'PNBHFL' to 56161
Frequently Asked Questions
What is the process for applying for PNB Home Loan Balance Transfer?
To apply for PNB Home Loan Balance Transfer you should follow these simple steps:
- On submitting the application, the assessment on the basis of various eligibility and other norms will be done.
- The legal scrutiny of the documents by panel advocate and the valuation of the property by the panel valuer will also be done. The loan amount will be based on the value of the property. The margin set for PNB Home Loan balance transfer is 10% to 25%.
- If the internal regulatory guidelines permit, PNB will approve the Home Loan balance transfer. On approval of the loan, you will have to execute the documents relevant to Home Loan balance transfer after which the loan amount will be disbursed.
- Once the loan is approved, the amount will be directly remitted to the credit of the outstanding Home Loan with the existing lender. Upon closure of the Home Loan account, the original property documents will be released and the new lender will get the custody of the original property documents. Apart from the documents received from the existing lender, if PNB requires any other additional documents, the same has to be provided.
Who is eligible for PNB Home Loan Balance Transfer?
The eligibility criteria for PNB Home Loan balance transfer are:
- The applicant should be a resident Indian
- Salaried Individual should have a minimum experience of 2 years in the existing job
- Self-employed professional/individual or businessmen should be in the present business for a minimum of 5 years.
- The minimum income should be 25,000 p.m
- The applicant should belong to the age group of 21 years to 65 years
How is the quantum of loan arrived at?
The quantum of loan is based on the value of the property and the income of the applicant. Generally, up to 80% of the value of the property will be funded.
If a floating rate of interest is opted, will the EMI change with the change in the rate of interest?
The EMI fluctuation will be there if there is a change in the rate of interest, but the option of either changing the EMI or loan tenure is given to the borrower. The borrower can either opt for an extension in loan tenure or change in EMI as per their convenience.
Are there any pre-payment charges for PNB Home Loan Balance Transfer?
You can either make part-payments or pre-payment without any charges.
What is the procedure to get Interest Certificate for PNM Home Loan Balance Transfer?
The Interest Certificate will be dispatched to the borrower's mailing address for every financial year. In any case, the borrower can also approach any nearest PNB branch and obtain the required interest certificate.
Is property insurance mandatory?
Yes, the property has to be insured for protection against natural calamities and other eventualities.