Bancolombia Reduces Mortgage Interest Rates by 150 Basis Points

Colombia’s largest bank Bancolombia this week lowered the interest rates on its mortgage offerings by up to 150 basis points. According to the Medellín-based financial institution, this move means its rates now start at 0.76% monthly, or 9.6% on an annual basis.

The bank said that these reduced rates apply for both new and used home financing, including mortgages offered under the Vivienda de Interés Social (VIS) program.

So far this year, Bancolombia says that it has approved nearly 1.4 trillion pesos ($480, million USD) in mortgages and sees the rate drop as part of a larger effort to help grease the wheels of a Colombian economy that has seen slow growth in recent years.

On top of the mortgage rate reduction, the bank reported that is has also lowered rates on credit cards (by 100 basis points on all transactions) and vehicle loans under its Sufi brand.

“One of the sectors that moves the economy the most is the automobile, and during the first months of this year the market has decreased compared to 2016,” said Juan Carlos Mora, president of Bancolombia. “That is why, from Sufi, we have decided to lower credit rates for new or used vehicles from 0.95%.”

The president added that, collectively, the rate reductions will make credit financing accessible to more Colombians and add “an important boost” to the nation’s economy.

Photo: Juan Carlos Mora, president of Bancolombia, says that the reduction in rates for mortgages, auto loans, and credit cards will provide “an important boost” for the Colombian economy. (Credit: Bancolombia)