Compares staying with your current bank versus transferring your outstanding loan to a new bank at a lower rate — accounting for the transfer fees, so you see the real net saving.
This calculates the total interest you'd pay for the remaining tenure at your current bank's rate versus the new bank's rate (assuming the same remaining tenure), then subtracts the one-time cost of switching (processing fee plus any other charges) from the interest saved. If the net result is positive, transferring saves you money over the remaining loan life; if it's negative or small, the switch may not be worth the effort for the saving involved.
It means moving your outstanding home loan from your current bank to a new bank offering a lower interest rate, so you pay less interest for the remaining tenure. The new bank pays off your old loan, and you start repaying the new bank instead.
Typically a processing fee from the new bank (0.5%-1% of the loan amount), and sometimes a small foreclosure administrative charge from your current bank, even though floating-rate home loan foreclosure itself is free for individuals per RBI rules.
Not always — it depends on how much lower the new rate is, how many years are left on your loan, and the transfer costs. A small rate difference late in your loan tenure may not be worth the hassle and fees; a larger difference early in the loan usually is.