6 replies on this article “Costs involved in shifting home loan from one bank to another?”

1. ashalanshu says:

   February 12, 2014 at 2:40 am

   Dear Roshan, I’m answering that purchasing a term cover has nothing to do with your home loan. Yes as you are running a loan, bank w’d like to make sure that in case of your demise, the money from the claim amount comes to it first.

   If you are purchasing a term cover higher than loan amount, you need not to assign the policy to bank. In my personal case, I’m having a large term cover and policy is not at all assigned to my bank.

   Thanks

   Ashal

   Reply
2. roshan says:

   February 11, 2014 at 5:39 pm

   Hello Ashal,

   Thanks for answering my query. Now when you say that home loan has nothing to do with term insurance does it mean that i dont need to make the bank as a nominee when i take a term insurance?

   Thanks,
   Roshan

   Reply
3. ashalanshu says:

   February 11, 2014 at 5:22 pm

   Dear Roshan, why do you want to cover your property for 75L Rs. If the market valuation is indeed 75L Rs. and you are ready to pay the required prem. any insurer ‘ll happily provide property cover to you.

   Yes you can avail term cover of your choice. Your home loan has nothing to do with your home loan.

   Thanks

   Ashal

   Reply
4. roshan says:

   February 11, 2014 at 10:46 am

   I have another query. The home loan amount is around 25 lakh. I understand that i can avail property insurance + term insurance.

   a) can i avail property insurance of 75 lakhs although my loan amount is just 25 lakhs? Any idea what the yearly premium will come to?

   b) Can i avail term insurance of 75 lakhs instead of 25 laksh which is my loan amount?

   Thanks,
   Roshan

   Reply
5. ashalanshu says:

   January 16, 2014 at 11:22 am

   Dear Vz, your assumption seems OK.

   Thanks

   Ashal

   Reply
6. AJ PlanRupee says:

   January 16, 2014 at 11:11 am

   Hi,
   The costs are more or less in order.
   EXCEPT for the insurance component. You are calling it ‘Home Loan Insurance’. It can either be (a) Term Insurance equivalent to the Loan amount OR (b) Property Insurance or a combination of both.
   Bank (institution) may always insist on any and every fee income product to be bundled with the loan. You may do well to know that they can not make it ‘mandatory’. It is a regulatory guideline(RBI) that all insurance can NOT be mandatory with loan.
   In summary:
   – If you already have adequate Term Insurance, provide a copy of that to the bank and you should be OK.
   – Property insurance will be in your own interest BUT the cost is no-where close to what you have mentioned, for 20 Lacs, it could be around Rs. 7,000/-.

   Reply

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