How to get a mortgage in Nigeria

As we discussed in our last post Nigeria’s Housing Deficit, this crisis and lack of affordable real estate in Nigeria is a daunting dilemma that is looming over our country’s leaders and citizens.

The federal government has recently announced an overhaul to the Nigerian mortgage system and the National Housing Fund, in an effort to help mitigate the vast housing deficit – according the Eagle Online.

Access to Funds

Revamping the mortgage system is vital in order to allow average working class Nigerians to get access to funds via bank loans in order to build or buy homes.

Currently there are many restrictions and roadblocks to the majority of the public to access capital needed for such endeavors.

Old requirements are as follows:

  • Loans up to N5 Million require 10% down payment (equity).
  • Loans up to N10 Million require 20% down payment (equity).
  • Loans up to N15 Million require 30% down payment (equity).

New Requirements

The new proposed requirements will allow borrowers to waive down payments for loans ranging from N5 – N15 Million. Other stipulations are that the borrowers must be over 18 years of age and have a steady paycheck.

While some may welcome these new provisions, I still think it behooves individuals to put up some equity via a down payment to show their commitment to the process, and make it less likely that they walk away from their obligations.

Cause for Optimism?

While these moves to overhaul the mortgage industry in Nigeria are a step in the right direction, there still is a lot of work to do to make this a reality for most Nigerians.

The system needs to be systematically altered to ensure there is fair access to funds for those that qualify, so home ownership can be a reality and not a dream.

Most developed countries have comprehensive mortgage systems (highly regulated) that act as a catalyst to boost home ownership, spawn construction projects and help reduce the lack of housing for their citizens – can Nigeria make this happen?

Lets hope so.

Roman Kingsley

Journalist based in the United States and Nigeria, focusing on Real Estate Development and the stories emerging in and around the built environment.

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