In Nigeria, the dream of owning a property is at risk, threatened by political turmoil, soaring inflation, limited accessibility, and daunting interest rates imposed by lenders. But fret not, there’s an alternative path to resurrect this dream – it’s the world of mortgages in Nigeria.
Rediscovering the Nigerian Dream: Reimagining Homeownership
The treasured Nigerian aspiration of property ownership is slowly slipping away, and the culprits seem to be political complexities, inflationary pressures, constrained accessibility, and lenders imposing intimidating interest rates. However, there is another route to realizing this dream, and that’s by navigating the realm of mortgages.
Unlocking the Mysteries of Mortgages: Your Key to Property Ownership
A mortgage, quite simply a sum of money, serves as the gateway to transferring property ownership. It is offered as collateral to a lender, often a Mortgage Bank, under the condition, whether explicit or implied, that the property – typically a home – will be re-transferred to the borrower, the home-owner, upon complete repayment of the mortgage. To qualify for a mortgage in Nigeria, certain prerequisites must be met, including your monthly income, monthly expenditure, existing debt profile, and the appraised value of the property. It is essential to assess your financial capacity before embarking on this journey.
Guidelines for Obtaining Mortgage Facilities
Obtaining mortgage loans with favorable terms is achievable in cities like Lagos and Abuja, albeit not without some challenges. Here’s a comprehensive roadmap:
Building a Deposit: Your journey towards property ownership begins with the accumulation of a deposit, typically a specific percentage required by both property owners and lending institutions.
Exploring Housing Schemes: Consider the National Housing Fund, established primarily to offer financing solutions to scheme contributors.
Assessing Loan Repayment Capability: Given the long-term nature of mortgages, financing institutions need assurance of your ability to meet repayment commitments. Calculate your monthly savings by subtracting your monthly expenses from your current income.
Identifying Mortgage-Eligible Properties: Not all properties can be acquired using mortgages, so seek out easily accessible options.
Securing a Mortgage Loan: If you possess an eligible property, have provided your deposit, and can demonstrate your commitment to a long-term payment agreement, proceed to sign an agreement and claim your property.
Accredited Mortgage Banks: Your Allies in Property Ownership
The Central Bank of Nigeria has accredited over 30 mortgage banks, empowering them to disburse National Housing Fund (NHF) loans and provide advisory services to those aspiring to become homeowners. Some of these accredited institutions include:
- Abbey Building Society
- Aso Savings & Loans
- Brent Mortgage Bank
- FBN Mortgages
- Lagos Building and Investment Company
- Mutual Alliance Savings and Loans
- New Prudential Building Society
- Nigerian Police Mortgage Bank
- Trustbond Mortgage Bank
- United Mortgage
Unlocking Homeownership with the Federal Mortgage Bank
The Federal Mortgage Bank of Nigeria (FMBN) has introduced an innovative rent-to-own mortgage home program, ushering in non-interest housing solutions to bolster financial inclusion. In contrast to the previous 7% annual interest rate, the bank now presents a more accessible avenue. To apply for housing, interested parties must visit any bank branch nationwide and complete an application free of charge. Applicants are required to be contributors to the National Housing Fund. Properties become immediately accessible for candidates who have had their finances accessed and are able to fully pay. This novel non-interest housing scheme allows Nigerians to own homes with mortgages, all without incurring interest charges.
Rediscover the Nigerian Dream of Homeownership Through Mortgages
Joining the Ranks of Homeowners: The NHF Rent-to-Own Program
Under this program, Nigerians who contribute to the National Housing Fund (NHF) Scheme can seize the opportunity to own a home, whether funded by FMBN or non-FMBN, with a maximum purchase price of N15 million. Beneficiaries can purchase the property through monthly, quarterly, or annual rental installments over a 30-year period, tailored to their age and years of service.
The Process and Requirements
Aspiring homeowners can start their journey by providing a passport-sized photograph, NHF contribution number, proof of identity, pay slips for the last three months, a certified personal bank statement for the last six months, a letter of confirmation from the employer, and a letter of undertaking to deduct the rental payment from the beneficiary’s salary and allowances. The Bank Verification Number (BVN) is also a requirement for the application process.
To apply, interested parties should visit an FMBN state office, arrange an inspection of the available properties, complete the application form, and submit it to the FMBN state office for processing.
The National Housing Fund (NHF): Empowering Homeownership
The National Housing Fund (NHF), established by the Federal Government of Nigeria in 1992, mobilizes funds from Commercial and Merchant Banks, Insurance Companies, Nigerian Workers, and the Federal Government to provide soft loans to its contributors. This initiative aims to make homeownership attainable for low-income employees who struggle to afford housing. Any Nigerian, whether in paid or self-employment, can contribute to and benefit from the scheme.
Becoming Eligible for NHF Loans
To qualify for a National Housing Fund (NHF) loan, you must meet the following criteria:
- You must be a Nigerian above the age of 18.
- You should have been a contributor to the National Housing Fund for a minimum period of six months.
- You must provide satisfactory evidence of a regular income flow to guarantee loan repayment.
Steps to Secure an NHF Loan
- Visit a duly accredited mortgage loan originator, also known as a primary mortgage bank (PMB).
- Obtain an application form, readily available from the PMB.
- Complete the form and submit all required documents.
- The PMB will then forward your request to the Federal Mortgage Bank Of Nigeria and provide a response.
Property ownership is often seen as a substantial financial investment. However, by registering and contributing to the National Housing Fund Scheme, you can acquire mortgage loans with single-digit interest rates, requiring only a maximum of 10 percent equity, making your dream of homeownership a reality over a 30-year period. It’s time to turn your property ownership aspirations into a tangible achievement.
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