Personal Loan Refinancing: Is it Worth the Hype? Uncover When it Truly Saves You Money
M
Moneycontrol•20-02-2026, 14:30
Personal Loan Refinancing: Is it Worth the Hype? Uncover When it Truly Saves You Money
•Refinancing a personal loan is often presented as an easy upgrade with lower interest and EMI, but it only benefits in specific situations.
•It's most effective when the loan is new (first year or two) as EMIs primarily cover interest, allowing you to replace expensive interest with cheaper rates.
•Refinancing can also be beneficial if your financial profile has significantly improved, leading to better rates from lenders.
•Consider refinancing for cash flow relief by extending tenure, even if it means more overall interest, to avoid missed EMIs.
•Refinancing deep into a loan, for small rate drops, or without considering foreclosure penalties often disappoints and adds hidden costs.
