How to Obtain a Federal Mortgage Loan in Nigeria
Are you searching for how to obtain a federal mortgage loan in Nigeria? In this article, we will cover the best ways to get a federal mortgage loan if you ever want to apply for one in Nigeria.
Getting a federal mortgage bank loan in Nigeria is not as difficult as people think. The loan helps workers in Nigeria have homes and other necessities.
A good step-by-step explanation process, as explained in this article, will help you easily secure a mortgage loan at the federal level. Since federal mortgage loans come in different packages, it is important to know your specific needs before applying for them.
Read More: How To Get Easy Loans and the Apps in Nigeria
The Purpose of a Federal Mortgage Bank Loan
Basically, the loan shall be mainly for building, purchasing, or renovating residential accommodation. No credit will be given for refinancing.
Who is eligible for the Federal Mortgage Loan?
Eligibility permits you to have the possibility of getting approved for a government mortgage loan. To be viewed as qualified, guarantee you have the accompanying standards;
- You must be 18 years of age or older.
- You must use NHF 1 (employer) and NHF 2 (employee) forms to register.
- Your chequebook must be updated and should be transferable from one job to another
- Must remit the monthly contributions they deducted to FMBN promptly (which must be at least 6 months’ contributions)
- You must have made contributions to funds for at least six months
- You must have a steady flow of income
- Savings account with a registered primary mortgage bank
- Contribution to the fund for a minimum of six months.
- Evidence of a regular flow of income.
- Photocopies of other substantiating title documents
- Survey and site plans
- A copy of an approved building plan
- Bill of Quantities (If you have one)
- A valuation report prepared by registered surveyors and valuers, where applicable
- Tax clearance certificate for three years
- Letter of consent to your chosen primary mortgage bank
- Completed mortgage loan application form
- Evidence of National Housing Fund contribution
- Payslips for the previous three months
- If you are a self-employed applicant, a copy of the Articles and Memorandum of Association and a copy of the Certificate of Incorporation should be submitted.
How to Apply For a Federal Mortgage Loan
The Federal Mortgage Bank of Nigeria (FMBN) allows institutional borrowers to apply directly to them. As an individual, you can also apply through a primary mortgage bank of your preference that is fully registered with the central bank of Nigeria.
The Government Mortgage Bank of Nigeria (FMBN) permits institutional borrowers to apply straightforwardly from them; as an individual, you can also apply through a primary mortgage bank of your inclination that is completely enlisted with the central bank of Nigeria.
To apply for a mortgage loan, follow these instructions below:
- You must get the loan applications from the same Primary Mortgage Institution
- You must have registered your principal mortgage institution with FMBN to use the national housing facility
Procedure for Federal Mortgage Loan Registration
Basically, it’s required under the law of Nigeria that every adult citizen of the country contribute 2.5% of their basic income to the fund. The procedure registration goes as follows:
- Your employers will receive an Employer registration form (NHF1) from the Federal Mortgage Bank of Nigeria
- Your employers will have to fill out and submit the NHF1 form to any Federal Mortgage Bank of Nigeria nearby.
- Your employers will be registered with the FMBN, and they will be assigned an employer registration number.
- Your employer will also be given NHF2 for employees to fill out, which will be submitted back to the FMBN
- The FMBN then assigns each employee a particular registration number.
- After this, the FMBN will give each registered employee a passbook where their monthly deductions will be recorded. It is usually 2.5% of their income.
- They can now consider an employee a registered participant of the National Housing Fund.
- Then the employer will deduct contributions at the source.
- Payments will be remitted to the FMBN every month and receipt payment will be issued
How much can you apply for?
Just like every other loan, there are limits to what you can borrow as an individual. For a federal mortgage loan, an individual may be eligible to borrow up to 15 million Naira. However, banks may tell you otherwise because it involves a lot of risks.
What is the interest rate on a federal mortgage loan in Nigeria?
No loans are free. Loans come with a fixed price known as interest. For the federal mortgage loan, the interest rate is about 6% per year on every loan.
How do I check your National Housing Fund contribution?
You are allowed to check your monthly contribution through the use of the USSD code or mobile app, or visit their official website. To use the USSD code, follow these instructions.
- Dial *219# on your mobile number linked to your account
- A prompt will be displayed; select 2 and send
- Then enter 1, and enter the exact month that you want to check
Loan Tenure
The maximum federal mortgage loan tenure repayment period shall be 30 years. Therefore, individual borrowers shall make repayments through the primary mortgage institution through which they got the loan.
The Federal Mortgage Bank operates in a way that targets partnerships with organizations with financial and technical capacity interested in delivering affordable mass housing for the low-income end of the market.
