How this balance transfer works
Both options are re-amortised from the same outstanding principal. Net savings subtract switching costs from the difference in future interest; break-even uses monthly payment savings when positive.
Worked example
A ₹40 lakh balance at 9% with 15 years remaining is compared with 8% after ₹50,000 costs. Change the new tenure to see how extension affects total interest.
Try it yourself: the form above starts with these illustrative values. Change any input to see the result and chart update instantly.
Assumptions used
- Rates stay fixed for comparison.
- All switching costs are paid now.
- No tax consequences are included.
What this estimate does not cover
- A longer new tenure can lower EMI while increasing total cost.
- Confirm lender quotations, legal costs and loan-specific charges.
Financial contracts can use day-count, rounding, reset and fee conventions that differ from this educational model. Use your lender’s official schedule for a contractual figure.
Frequently asked questions
What if break-even is longer than I will keep the loan?
The transfer may not recover its upfront cost within your expected holding period.
Is lower EMI always a saving?
No. A tenure extension can lower EMI but increase the number of payments and total interest.
Official references
Regulatory statements are deliberately limited and linked to primary sources. These sources were last reviewed on 3 November 2026.
- RBI: Levy of foreclosure charges / pre-payment penalty on floating-rate term loans — Banks; floating-rate term loans sanctioned to individual borrowers. Always confirm current applicability to the specific loan.
- RBI FAQ: Reset of floating interest rates on EMI-based personal loans — Communication and options around interest-rate resets; home loans fall within the RBI definition of personal loans for this framework.
- RBI consumer guidance on home loans — General borrower education on APR, fees, margin/down payment and lender comparisons. Some examples may be historical; verify lender terms.