5 Points To Remember About Business Loan Balance Transfer
Understanding these key points about business loan balance transfer works will make it easier for you to decide whether it is right for you or not. Read to know!
Business loans have become an ideal financial instrument for budding entrepreneurs looking to start their businesses but lacking the required capital. The loan amount allows you to raise funds instantly without going through a time-consuming loan process. However, there may be a time when a different financial company or a bank offers better interest rates or tenure than your current lender. In such a case, you can choose to transfer the current business loan to a different financial institution.
This blog highlights some crucial business loan balance transfer process steps and how they can contribute to your financial goals.
Five Points To Remember About Business Loan Balance Transfer
Business loan options are constantly changing and may be better with a different financial institution. Through the business loan balance transfer process, you can transfer up to 3 loans to a single financial institution for better repayment prospects.
Here are the five things you should remember about business loan balance transfer:
1. Eligibility Criteria
All financial institutions have their own distinct eligibility criteria for taking or transferring a loan. If you are looking to transfer your loan for business to another institution, it is important to fulfill the set criteria by that financial institution. If you are eligible to take a loan from a financial institution, you can transfer your current loan for your business.
In the process of the business loan balance transfer, you will need to complete the KYC requirements by submitting the required ID documents. Some of the proof of ID documents required are PAN Card, Aadhar Card, bank and income statements, etc.
3. Interest Rate
The interest rate provided by the new financial institution must be lower than your current loan. As you will have to pay monthly interest to the new financial institution, the loan balance transfer process will only be successful with a financial institution charging lower interest.
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4. Balance Transfer Cost
The loan transfer process comes with a balance transfer cost which you will have to pay to the current lender. However, the fee is minimal as the lender has already processed almost all the business particulars. However, you must factor in such costs before transferring the loan.
5. Credit Score
Your credit score also plays a role in a loan balance transfer. If you have defaulted on interest payments to the current lender, it can negatively affect the possibility of transferring the loan. Hence, it is important to have a good credit score and history.
Avail Of A Business Loan With IIFLIIFL Finance is India’s leading financial services company that provides comprehensive and customized loans for your business to fulfill your capital requirements. You can also transfer your current business loan balance to IIFL Finance to get a better interest rate and repayment flexibility. If you need additional funds, you can get instant funds up to Rs 30 lakh through a quick disbursal process. Apply for the loan online by verifying your KYC details or offline by visiting IIFL Finance nearest branch.
Q.1: Why should I transfer the balance of my business loan?
Ans: You can transfer the balance loan amount if you are getting a better interest rate and avail of an additional loan amount for your business with a new financial institution.
Q.2: Who is eligible for a business loan balance transfer?
Ans: Customers currently repaying their loan and looking for a better interest rate can transfer their business loan balance (up to 3 loans).
Q.3: Who can avail of the business loan balance transfer service?
• Self-Employed Individuals
• Partnership Firms
• Private Limited Companies
• Proprietorship Firms
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