Owning a home is a dream for many people, but continuously rising property prices often become a challenge. A home loan transfer (over credit) can be a solution for those who want to buy a house without having to pay in full upfront or apply for a new mortgage.
Through an over credit process, you can take over the remaining mortgage installments from the previous owner, making the process of homeownership faster and more efficient. Although it seems practical, over credit is different from a mortgage take-over and has its own mechanisms and requirements. To avoid making the wrong choice, let’s explore the full explanation in this article.
What Is a Home Loan Transfer (Over Credit)?
A home loan transfer (over credit) is the process of transferring the remaining mortgage installments from the original borrower to a new borrower. This process can be carried out without the bank’s direct involvement. In this case, the new borrower or buyer simply continues paying the ongoing installments according to the bank’s terms.
Meanwhile, a mortgage take-over is a process in which a borrower transfers their mortgage from one bank to another that offers a lower interest rate. In addition to lower interest, the loan tenor can also be adjusted to the borrower’s repayment capacity without having to sell the house.
Generally, over credit is chosen when the homeowner faces financial difficulties or wants to quickly release their asset. In practice, over credit involves three parties: the homeowner as the original borrower, the buyer as the new borrower, and the bank as the lender.
The over credit process can be done officially through a bank or through a notary. Although it appears simple, this process requires complete documentation and legal agreements to ensure the transaction is secure and clear for all parties.
Types of Home Loan Transfers (Over Credit)
Home loan transfers can be carried out in several different ways. Each type has its own mechanism that you should understand from the start. Below are the main types:
1. Buy-and-Sell Home Loan Transfer
This type of over credit involves purchasing a house while simultaneously taking over the remaining mortgage installments from the previous owner. This means you continue the ongoing installments without starting a new loan from scratch. The process involves the seller, the buyer, and the bank as the lender.
The transfer is conducted officially through the bank with certain administrative requirements. Once approved, the bank issues documents such as the Sale and Purchase Deed (AJB) and the Power of Attorney to Grant Mortgage Rights (SKMHT). Costs usually include penalties from the previous bank, mortgage-related fees, and notary fees, making early coordination essential for a smooth transaction.
2. Under-the-Table Home Loan Transfer
An under-the-table home loan transfer is carried out directly between the seller and the buyer without involving the bank. The agreement is made before a notary, while the loan data at the bank remains under the original borrower’s name. Although the costs are lower because there are no penalties or new mortgage applications, the risks are significant.
The property certificate remains under the original borrower’s name until the loan is fully paid off, which can lead to disputes in cases of default or certificate seizure. Legal certainty and security must be carefully considered before choosing this scheme, as it is not officially recorded by the bank.
3. Interbank Home Loan Transfer
An interbank home loan transfer involves moving a mortgage from one bank to another to obtain a lower interest rate or better services. The buyer applies for a new mortgage, which is then used to pay off the remaining loan at the previous bank.
Although this can reduce monthly installments, the process still involves costs. These include early repayment penalties from the old bank—usually around 1–3% of the remaining balance—as well as new mortgage fees such as appraisal, notary, and insurance. Therefore, it is important to calculate all costs upfront to ensure the over credit decision remains financially beneficial.
Benefits and Risks of Home Loan Transfers
Unlike a mortgage take-over, home loan transfers are usually offered by banks when the original borrower defaults. The process is simpler, but it still comes with both benefits and risks that should be understood in advance.
Benefits
The house price is generally lower because you only continue paying the remaining installments that have already been partially paid by the previous owner. The credit burden and interest may also feel lighter. In addition, the certificate name transfer can be processed immediately after the over credit agreement, although the certificate remains as bank collateral until the loan is fully repaid.
Risks
The previous borrower’s credit history may become your responsibility if there were past issues, making credit checks essential. There is also a risk that the asset is involved in legal disputes, which could lead to seizure or prevent immediate occupancy. Therefore, make sure the credit status and property legality are thoroughly checked before making a decision.
Requirements for a Home Loan Transfer
To ensure a smooth over credit process, several requirements must be met. Generally, these are similar to initial mortgage application requirements and involve the buyer, the seller, and the bank in one agreement.
Buyer Requirements
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Stable income that meets the bank’s credit criteria
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Buyer’s ID card and spouse’s ID card (if married)
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Family Card and marriage certificate
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Tax Identification Number (NPWP)
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Employment certificate
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Salary account statement and last 3 months’ payslips
Seller and Property Documents
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Seller’s ID card
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Copy of the property certificate and building permit (IMB)
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Copy of the credit agreement and financing contract
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Property tax documents (SPPT and PBB) with proof of payment for the last 5 years
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Bank book and proof of the latest installment payment
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Outstanding mortgage balance information
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Agreed over credit cost details
Costs of a Home Loan Transfer
The home loan transfer process involves several costs that should be prepared in advance, including:
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Booking fee, as a down payment or initial guarantee to the seller
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Down payment (DP), paid to the bank
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Installments, including ongoing payments, interest, and possible bank penalties
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Taxes and administrative fees related to the over credit process
How to Transfer a Home Loan
To ensure the over credit process is safe and compliant, the seller, buyer, bank, and notary should meet directly to agree on the terms. Below is a brief overview of how to transfer a home loan through a bank and a notary.
1. Home Loan Transfer Through a Bank
When transferring a home loan through a bank, the entire process is official and recorded. The general steps include:
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Prepare all required documents
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Visit the bank where the original borrower applied for the mortgage
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Submit an over credit request to the credit department
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Apply for the transfer from the original borrower to the new borrower
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Complete forms and submit required documents
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Wait for the bank’s analysis and approval
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Once approved, both parties sign the over credit agreement
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The bank processes the certificate name transfer, although the certificate remains collateral until the loan is fully repaid
2. Home Loan Transfer Through a Notary
Over credit through a notary is usually faster because it does not involve reapplying to the bank. However, the property certificate cannot be immediately transferred even after the agreement is made. The general steps include:
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Prepare all required documents
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The original and new borrowers agree on a notary
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Submit an over credit request to the notary
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The notary drafts a binding sale and purchase agreement
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The notary issues an over credit agreement outlining the new borrower’s obligation to repay the remaining installments and permission to retrieve the certificate
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The original borrower issues a notification letter regarding the over credit
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Copies of the deed are submitted to the bank for notification
Can a House with a Pledged Certificate Be Transferred?
Transferring a house whose certificate is pledged follows a different scheme from a mortgage over credit. In this case, the house is already owned by the borrower, but the certificate is used as collateral for another loan, such as a multipurpose or business loan.
To sell the house, the borrower must first repay the remaining debt to the bank or financing institution, usually using a down payment or funds from the buyer. Once fully repaid, the certificate is released and a lien removal (roya) is conducted to clear its status. Only then can the sale proceed as usual, either through credit or cash, as agreed.
In short, the steps include requesting bank approval, checking and settling the remaining debt, processing the lien removal, and creating a Sale and Purchase Deed before a notary to ensure legal security.
That concludes the complete discussion on home loan transfers, covering types, requirements, benefits, and important steps to consider. By fully understanding the process, you can make safer decisions that align with your financial condition.
If funds for property-related needs are still insufficient, you can take advantage of financing solutions from BFI Finance using motorcycle ownership documents (BPKB), car ownership documents (BPKB), or property certificates for houses, shop houses, or office houses.
With over 40 years of experience and official supervision from the Financial Services Authority (OJK), BFI Finance is a trusted partner in every process. Don’t let limited funds hinder your plans—take more confident financial steps because #SelaluAdaJalan with BFI Finance.
