Stanbic offers 50% home equity loans

Published: 29 March 2018

STANBIC Bank Zimbabwe is offering 50 percent home equity loans that allow home owners to move from one level of financial freedom to another.

This comes as financial institutions are creating financing facilities that can help depositors access funds through what is termed a home equity loan

A home equity loan is a loan facility in which the borrower uses the equity of his or her home to borrow. Equity is defined as the current market value of a home minus any outstanding mortgage balance.

Stanbic Bank head of personal and business banking Patson Mahatchi said home equity is the current market value of a house compared to the price it was bought.

"Essentially the property would have appreciated in value over time," he said.

Various financial institutions recently added this product onto their offerings but the values they offer differ across the market.

"You will find that some institutions offer 20 percent or 30 percent of the assessed value of your property, but we offer up to 50 percent. Our offering is very competitive in the market and we would like to keep it that way to allow customers access to funds that will allow them to adequately cover their financial needs," Mahatchi said.

"We have seen customers who have managed to use these funds to start businesses or add capital to expand their existing businesses successfully. This is a great way to invest the funds because it makes it possible to make profits that will cover the interest costs of the loan," he added.

The home equity loan requires no deposit and can have a maximum tenure of 10 years.
- newsday

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