Home Equity Loan
With a home equity loan, you pledge a property as collateral and obtain credit at rates close to those of standard mortgage financing — generally between 1% and 1.5% per month, well below unsecured personal loans. The bank can finance…
Explanation
With a home equity loan, you pledge a property as collateral and obtain credit at rates close to those of standard mortgage financing — generally between 1% and 1.5% per month, well below unsecured personal loans. The bank can finance up to 60–70% of the appraised property value.
This option suits those who need capital for investments, renovations, or purchasing another property, and who own a property with accumulated equity. The risk: in case of default, the property can be foreclosed and auctioned — exactly as with a fiduciary lien (alienação fiduciária).