A recent loan product by HSBC, under the name of Maxicredit, has been released to entice property owners into put there homes up as a guarantee or collateral in hope that homeowners will borrow against the value of their property.

Home equity loans have proven to be a blessing for some but a curse for many other consumers, especially in societies where people have a large amount of consumer debt. While this type of debt is marketed as an easy way for consumers to "…unlock this wealth, enabling the owner to use the loan proceeds on practically anything", according to HSBC. The concern is that a relatively high proportion of home owners, many of whom have little or no debt on their property will wander into financial quicksand because of these loan products.

Only time will tell if consumers are prepared to responsibly handle this easy access to cash.

Home equity wealth gives people a false sense of security that people are wealthier than they may actually be. This false sense of financial security has led consumers in the United States, UK and other countries to over borrow and lose their home to foreclosure and repossession when they were unable, for whatever reason, to be able to afford the new mortgage payments.

Of greater concern are those homeowners that will release equity from their homes to use for debt consolidation loans. While they may pay off credit card debts, they are turning an unsecured credit card debt into a financial obligation secured by their very home. And when it comes to mortgages there is a universal law that applies, says Steve Rhode of the global social enterprise, Myvesta Foundation "you've got to pay to stay."

It was HSBC Bank Malta p.l.c., in fact, in 1999 that launched the Equity Release Loan, a packaged product combining attractive interest rates with long term borrowing for any purpose. Home Equity release loans are now available under the HSBC brand name Maxicredit, and come with a variable or a fixed interest rate option, and in Maltese Lira or euro.

The Maxicredit loan products are being promoted as the ideal product to finance medium to high value expenditures, according to HSBC, so the repayment may be spread over a long term, up to 20 years. This may include anything from buying a luxury car to financing the purchase of property abroad.

Maxicredit customers are also offered a full financial review which may include life and critical illness protection, investment management and retirement planning. They may also make use of our competitively priced life and Home Loan Credit Insurance policies. The latter insures the borrower against accident, sickness and involuntary unemployment during the term of the loan. These payment protection insurance or credit protection insurance policies have come under fire in other countries, like the United Kingdom. Many of these policies have been found to fleece consumers of premiums but never offer any real protective benefit.

We can't lose sight of the fact that banks offer home equity products as an additional way to generate and make profits. While access may be easy, it does come with risks that consumers should at least be well aware of.