What Is a House and Lot Collateral Loan in the Philippines?
A house and lot collateral loan — often called a real estate-backed loan or property equity loan — lets you borrow money by pledging your house and lot as security to the bank. Instead of applying for a personal loan with its high interest rates (often 25–36% per year), you unlock the value sitting in your property to access a much larger amount at a far lower rate.
In the Philippines, this type of financing goes by several names depending on the bank and the purpose: home equity loan, real estate loan (REL), multi-purpose loan secured by real estate, or simply a loan against property. Regardless of the label, the mechanics are the same — your Transfer Certificate of Title (TCT) or Condominium Certificate of Title (CCT) serves as collateral, and the bank lends you a percentage of your property's appraised value.
This guide explains exactly how these loans work, which banks offer them, what rates to expect, and — critically — when refinancing your existing mortgage might be the smarter move instead.
How Much Can You Borrow Against Your House and Lot?
Philippine banks typically lend between 60% and 80% of your property's current appraised value. This is called the Loan-to-Value (LTV) ratio. Here is how that plays out in practice:
- Property appraised value: 5,000,000
- Maximum LTV at 70%: 3,500,000
- If you still owe 1,200,000 on your existing mortgage: Net loanable amount ≈ 2,300,000
If your property is fully paid off, the entire LTV amount is available to you. If you still carry a mortgage, most banks will only release the difference between what you owe and the maximum loanable amount. This is why many Filipinos who have been paying their home loan for several years find they have substantial equity they can tap.
Typical Loanable Amounts by Property Value
- Property worth 2,000,000 → up to 1,400,000 (at 70% LTV)
- Property worth 4,000,000 → up to 2,800,000 (at 70% LTV)
- Property worth 7,500,000 → up to 5,250,000 (at 70% LTV)
- Property worth 10,000,000 → up to 7,000,000 (at 70% LTV)
The appraised value used is the bank's own appraisal — not the market price you think your home is worth, and not the zonal value. Banks hire their own accredited appraisers, and their figures are often more conservative than what you'd find on the open market.
Interest Rates for House and Lot Collateral Loans
Because your property secures the loan, interest rates are significantly lower than unsecured consumer credit. Here is a realistic picture of what Philippine banks charge in 2025:
- Fixed-rate period (1–3 years): 6.5% to 9.5% per annum
- Fixed-rate period (5 years): 7.5% to 10.5% per annum
- Repricing rate after fixed period: Variable, tied to market benchmarks — often higher
The exact rate depends on the bank, your credit profile, the loan amount, the purpose of the loan, and the prevailing interest rate environment. Rates for multi-purpose loans secured by real estate tend to be slightly higher than pure home acquisition loans, because banks price in the added risk that the funds are not going directly into the property.
For context: if you already have a home loan and you are paying 8.5% or higher, you may not need a separate collateral loan at all. Check what home loan interest rates look like today — because refinancing your existing mortgage to access cash at a lower blended rate is often the smarter and cheaper path.
Which Banks Offer Collateral Loans on House and Lot in the Philippines?
Most major Philippine banks offer some form of real estate-secured lending beyond basic home acquisition loans. Here is a quick overview:
BDO Unibank
BDO offers a Home Equity Loan that lets existing BDO home loan clients borrow against the accumulated equity in their property. Loan amounts typically start at 500,000 and can go up to 70% of appraised value. Terms of up to 10 years are available for equity loans.
BPI (Bank of the Philippine Islands)
BPI's Home Loan product line includes a Home Equity facility for existing clients. They are known for competitive processing and relatively straightforward requirements. BPI also offers multi-purpose loans secured by real estate for non-BPI existing mortgages.
Security Bank
Security Bank offers a Home Equity Loan specifically marketed toward homeowners who want to tap existing equity — whether for home renovation, debt consolidation, education, or business capital. They are one of the more flexible lenders on LTV ratios for well-located properties.
Metrobank
Metrobank offers real estate-secured loans with competitive fixed-rate periods. Their process requires a formal appraisal and standard documentation. Loan terms up to 20 years on acquisition loans, though equity/multi-purpose products tend to cap at 10–15 years.
RCBC, EastWest, UnionBank, Chinabank, PNB
All of these banks offer real estate-secured loan products, though availability and terms vary by branch and the bank's current appetite for this type of lending. It is worth getting quotations from at least three banks before committing.
Pag-IBIG (HDMF)
Pag-IBIG offers a Multi-Purpose Loan (MPL) for members, but this is based on your provident fund savings, not your property value. For larger amounts tied to property equity, Pag-IBIG's Home Equity Appreciation Loan (HEAL) allows qualified members to borrow against property value increases — though eligibility requirements are specific and loan amounts are typically smaller than commercial bank offerings.
Requirements: What You'll Need to Apply
While requirements vary slightly by bank, you can expect to prepare the following documents for a house and lot collateral loan in the Philippines:
Property Documents
- Original Owner's Duplicate Copy of TCT or CCT
- Tax Declaration (land and improvement) — updated within the current year
- Real Property Tax (RPT) receipts — latest and current
- Lot Plan with vicinity map (signed by a licensed geodetic engineer)
- Floor plan (for the house/improvement)
Personal and Financial Documents
- Valid government-issued IDs (2 copies, 1 primary ID)
- Filled-out bank loan application form
- Proof of income: payslips (last 3 months) or ITR (last 2 years) for employed applicants; audited financial statements for self-employed
- Certificate of Employment with compensation
- Marriage Certificate (if applicable)
If There Is an Existing Mortgage
- Latest Statement of Account from your current lender
- Proof of mortgage payments (last 12 months)
Processing times vary from 2 to 6 weeks depending on the bank's backlog, the complexity of the appraisal, and whether your documents are complete. Incomplete submissions are the number one cause of delays.
Collateral Loan vs. Mortgage Refinancing: Which Is Right for You?
This is the question most Filipino homeowners should ask themselves before applying for a separate collateral loan. The two options are fundamentally different and serve different needs.
Use a Collateral Loan If:
- Your property is fully paid and unencumbered
- You need a lump sum for a specific purpose (renovation, business expansion, medical expenses) without wanting to disturb other financial arrangements
- You do not currently have a home loan to optimize
Consider Refinancing Instead If:
- You already have an active home loan at 7%, 8%, 9%, or higher
- You want to lower your monthly amortization
- You want to access equity while simultaneously getting a better interest rate on your existing balance
- Your original fixed-rate period has ended and your bank has repriced you upward
Here is a concrete example. Suppose you owe 3,500,000 on a home loan at 9% with 18 years remaining. Your monthly payment is approximately 31,560. If you refinance that same balance to 5.99% over 20 years, your monthly payment drops to approximately 25,030 — a saving of around 6,530 per month, or 78,360 per year. Run your own numbers using Nook's refinance calculator to see exactly what you could save.
Refinancing through Nook is also 100% free for the borrower — Nook earns from the banks, not from you. There are no broker fees, no service charges, and no obligation to proceed after seeing your options.
Important Costs and Fees to Watch Out For
Whether you take a collateral loan or refinance, there are transaction costs involved. Understanding these upfront prevents surprises:
- Appraisal fee: 3,000 to 6,000 (non-refundable in most banks)
- Processing fee: 5,000 to 10,000 or 0.5% of the loan amount
- Documentary Stamp Tax (DST): 1.5 per 200 of the loan amount (set by the Bureau of Internal Revenue)
- Mortgage Registration Fee: Based on a sliding scale at the Registry of Deeds
- Notarial fees: Typically 1,000 to 3,000
- Mortgage Redemption Insurance (MRI) / Credit Life Insurance: Required by most banks, usually added into your monthly payment
- Fire insurance: Required for the property; computed on the insured value of the structure
For refinancing specifically, you may also encounter a pre-termination penalty from your current lender if you are still within the fixed-rate lock-in period. This is typically 2–5% of the outstanding balance. Factor this into your break-even calculation before switching — though for borrowers who have already passed their lock-in period, this fee often does not apply.
Key Takeaways
- A house and lot collateral loan lets you borrow 60–80% of your property's appraised value at rates far below personal loans
- Major banks including BDO, BPI, Security Bank, Metrobank, and RCBC offer these products
- You need a clean title, updated tax documents, and proof of income to qualify
- If you already have a home loan at 7% or above, refinancing may save you more money than taking an additional collateral loan
- Nook helps Filipino homeowners compare refinancing offers across multiple banks — for free — so you can find the lowest available rate without doing all the legwork yourself