What Is a Home Equity Loan in the Philippines?
A home equity loan — sometimes called a home equity loan or equity financing — lets you borrow money using the value you've already built up in your property as collateral. Think of it this way: if your home is worth 5,000,000 pesos and you still owe 2,000,000 pesos on your mortgage, you have 3,000,000 pesos in equity. A home equity loan lets you unlock a portion of that equity as cash, without selling your home.
In the Philippines, home equity loans are offered by most major banks and are commonly used for home renovation, business capital, debt consolidation, tuition, or medical expenses. They are distinct from a standard home purchase loan — instead of buying a property, you're borrowing against one you already own.
Home Equity Loan vs. Refinancing: What's the Difference?
Many Filipino homeowners confuse home equity loans with mortgage refinancing, and it's worth clarifying the difference before you decide which path is right for you.
- Home equity loan: A separate, additional loan taken on top of your existing mortgage. You receive a lump sum and repay it at a fixed or variable rate. Your original mortgage continues running alongside it.
- Cash-out refinancing: You replace your existing mortgage with a new, larger loan. The difference between the new loan and your old balance is released to you as cash. This means you have only one loan to manage, often at a new — potentially lower — interest rate.
If your current home loan interest rate is high (many Filipino homeowners are still paying between 7% and 10% per year), cash-out refinancing through a platform like Nook can be a smarter move: you unlock equity and reduce your monthly repayments at the same time. You can use our home loan refinance calculator to see exactly how much you could save by doing both at once.
Which Banks Offer Home Equity Loans in the Philippines?
Most of the country's major commercial banks offer some form of home equity or property-backed lending. Here's what you need to know about the main players:
BDO Unibank
BDO offers a Home Equity Loan product that allows existing property owners to borrow against their real estate. Loan amounts typically start at 1,000,000 pesos and go up depending on the appraised value of the property. BDO's rates are variable and repriced annually, usually falling in the 7% to 9% range for the first fixing period.
BPI (Bank of the Philippine Islands)
BPI's home equity facility is well-regarded for its streamlined processing. BPI typically allows borrowers to access up to 60% to 70% of their property's appraised value, less any outstanding mortgage balance. Fixed-rate periods of 1, 2, 3, 5, or 10 years are available, with rates generally starting around 7.5% per annum.
Metrobank
Metrobank offers property equity loans for both residential and commercial properties. Their product is flexible, with loan terms of up to 20 years and competitive rates for well-qualified borrowers. Metrobank requires a clean title (TCT or CCT) and a satisfactory credit history.
Security Bank
Security Bank's home equity loan is popular among self-employed borrowers and business owners who need flexible documentation options. They typically lend up to 60% of the appraised value and offer repayment terms of up to 10 years for equity loans.
RCBC and Chinabank
Both RCBC and Chinabank have competitive home equity products, particularly for borrowers in Metro Manila and key urban centers. RCBC tends to be slightly more flexible on property types, while Chinabank is known for efficient processing times.
EastWest Bank and PSBank
These mid-sized banks also offer equity-based lending and can be good alternatives if you have an existing relationship with them. PSBank, as a subsidiary of Metrobank, follows similar credit standards but sometimes has promotional rates for existing depositors.
Pag-IBIG (HDMF)
Pag-IBIG offers a Multi-Purpose Loan (MPL) and a Home Equity Appreciation Loan (HEAL) for qualified members. The HEAL in particular allows members to borrow against the appreciated value of their Pag-IBIG-financed property, with rates significantly lower than commercial banks — sometimes as low as 6% to 7% per annum. If you have a Pag-IBIG housing loan, check your eligibility before approaching a commercial bank.
How Much Can You Borrow? Understanding LTV Ratios
The key number in any home equity loan is the Loan-to-Value (LTV) ratio — the percentage of your property's appraised value that the bank is willing to lend against, in total (including any existing mortgage).
Here's a practical example. Suppose your home is appraised at 6,000,000 pesos and you have an existing mortgage balance of 2,500,000 pesos:
- If the bank allows a maximum LTV of 70%, they will lend up to 4,200,000 pesos in total (70% of 6,000,000).
- Since you already owe 2,500,000 pesos, the maximum equity loan you can access is 4,200,000 minus 2,500,000 = 1,700,000 pesos.
Typical LTV limits by bank type in the Philippines:
- Commercial banks (BDO, BPI, Metrobank, etc.): 60% to 70% LTV
- Thrift and rural banks: 50% to 60% LTV
- Pag-IBIG HEAL: Up to 90% of appreciated value for eligible members
Note that banks use their own appraised value — not the market value you might have in mind — so it's common for the official appraisal to come in 10% to 20% lower than what similar properties are selling for in the market.
Home Equity Loan Interest Rates: What to Expect in 2026
Home equity loan rates in the Philippines are generally slightly higher than standard home purchase loan rates, because the bank is taking a second-lien position (or because of higher perceived risk). As of 2026, you can expect:
- 1-year fixed rate: 7.5% to 9.5% per annum
- 3-year fixed rate: 8% to 10% per annum
- 5-year fixed rate: 8.5% to 10.5% per annum
Rates vary significantly between banks and are also affected by your credit score, income, the property type, and your existing relationship with the bank. If your primary goal is to reduce your borrowing cost, it's worth checking whether current home loan interest rates through a refinance might give you a better all-in cost compared to stacking a separate equity loan on top of your existing mortgage.
Requirements for a Home Equity Loan in the Philippines
While each bank has its own checklist, the standard requirements across most Philippine banks include:
Personal Documents
- Valid government-issued ID (at least two)
- Proof of income: payslips (last 3 months) for employed borrowers, or ITR and audited financial statements for self-employed
- Certificate of Employment (for salaried applicants)
- Marriage certificate (if applicable)
Property Documents
- Original Transfer Certificate of Title (TCT) or Condominium Certificate of Title (CCT)
- Certified true copy of title from the Registry of Deeds
- Tax Declaration (land and improvement)
- Real Property Tax (RPT) receipts — at least the most recent year
- Latest Statement of Account from your current mortgagee (if applicable)
Other Requirements
- Duly accomplished loan application form
- Authorization letter for property inspection and appraisal
- Floor plan or vicinity map
Processing times typically range from 2 to 6 weeks from submission of complete documents, depending on the bank and whether a new appraisal is required.
Costs and Fees to Watch Out For
Home equity loans come with a range of upfront and ongoing costs that borrowers often overlook. Before signing anything, make sure you understand:
- Appraisal fee: 3,000 to 8,000 pesos, paid upfront to the bank's accredited appraiser
- Processing fee: Typically 5,000 to 10,000 pesos, though some banks waive this for promotional offers
- Mortgage registration fee: Based on the loan amount, usually 0.25% to 0.5%
- Notarial fees: 1,000 to 3,000 pesos
- Fire insurance: Required annually, typically 0.1% to 0.2% of the insured value per year
- Mortgage Redemption Insurance (MRI): Life insurance tied to the loan balance, required by most banks
These fees can add up to 30,000 to 60,000 pesos or more on a large loan. Factor them into your break-even calculation — especially if you're comparing this option against refinancing your entire mortgage.
Is a Home Equity Loan the Right Move for You?
A home equity loan makes strong sense in specific situations:
- You need a lump sum for a defined purpose (renovation, business expansion, emergency) and your current mortgage rate is already competitive.
- You want to keep your current mortgage terms intact and simply access additional funds.
- The cost of the equity loan is still lower than alternatives like personal loans (which typically run 15% to 30% per annum in the Philippines) or credit cards.
On the other hand, consider cash-out refinancing instead if:
- Your current mortgage rate is above 7.5% and you could qualify for a rate of 5.99% or lower through Nook.
- Managing two separate loan accounts would be complicated for your cash flow.
- You want to simplify your finances into a single, lower monthly payment while also releasing equity.
The math often favors refinancing when rates have dropped significantly since you took out your original loan. Run the numbers using our free refinance calculator before committing to a standalone equity loan.
How Nook Can Help
Nook is the Philippines' first digital mortgage broker, and our service is completely free to borrowers. We work with multiple banks to find you the best available rate — currently as low as 5.99% per annum — and we guide you through the entire process from application to disbursement. Whether you're looking at a cash-out refinance or a straight home equity loan, Nook can compare your options across multiple lenders in minutes, saving you weeks of running from branch to branch.