Home ownership is the cornerstone of a strong community.  As a basic need of man, the importance of housing cannot be overemphasized. Recognizing this, recent debates within built sector in Nigeria reiterate unanimous opinions that a well-define mortgage system is required to offset the housing deficit quoted at about 17 million.

Major efforts have already been made to create a well-defined mortgage system, especially the inauguration of the Nigeria Mortgage Refinance Company and the recapitalization exercise of the Primary Mortgage Institutions (PMIs) in the country, that had 10 mortgage banks (Aso, Imperial Homes; Formerly GThomes, Abbey, Platinum, Mayfresh, Jubilee-Life, Trust Bond, Sun Trust, Infinity Trust and Haggai) approved to remain in business with a national license, and 26 other mortgage banks approved to operate with a state license. These laudable developments however arouse lots of questions about the nitty-gritty of the requirements to be able to assess a mortgage facility especially amongst middle and low income earners.

A random survey of products by primary mortgage institutions reveals a wide range of mortgage offering targeted at different market segments. For instance, a quick glance at the products offered by Imperial Homes Mortgage Bank Limited (formerly GThomes) as seen on their website, features four distinct products that cut across all socio-economic classes; from high income earners to low income earners, with a minimum of N 20, 000 to open an account and maximum set at N 500, 000. Also, requirements to access mortgage facilities include minimum savings period ranging from 6months to 2years, minimum mortgage loan amount ranging between 7million to 36million, equity contribution ranges from 20% to 35% of the value of property and mortgage tenure of up to 10 years.

Despite the varying interest rates offered by the various mortgage institutions, the primary concerns of mortgage seekers has remained the high interest rate and short tenure of mortgages. There is hope that in the near future, the sector will enjoy rapid development that would bring about the flexibility in the mortgage sector.

 

 

 

 

 

 

 

 

 

2014-07-09