Homeownership is a significant issue for Nigerians with low to middle incomes. Unverified figures estimate the current housing shortage to be around 17 million. There are many folks with stable jobs who don’t own their own homes. Instead, they are renting apartments.
We have come to the conclusion that some people desire to apply for a mortgage loan but are unsure on how to do it. Regardless of where you live, we will walk you through the straightforward 10-step process of getting a mortgage loan in Nigeria today.
- Be able to prove your source of income
Making sure you have a verified source of income is the first step in applying for a mortgage loan in Nigeria. Make sure you have a source of income that will guarantee repayment during the loan time without defaults. This is one of the fundamental prerequisites that the mortgage bank will evaluate. They would ask for 6- to 12-month worth of account statements. Because mortgage loans are long-term in nature and the Bank would not want to process or accept a loan for a person who does not have a means of repayment, it is essential that a mortgage loan applicant has a verifiable source of income.
- Have a clean credit history
Having a solid credit rating is something you should concentrate on if you want to apply for a home loan. If the application has previously accepted a loan from a lending institution and defaulted, this will impact the applicant’s credit score, and no financial institution will grant a loan to that individual.
- Look for a property that is within your budget.
Once you can demonstrate that you have a reliable source of income and a high credit score, the following step is to look for a property that falls within your price range. Making sure that the property has a title that is in good standing and allows for the creation of a legal mortgage, such as a Certificate of Occupancy, registered Deed of Assignment, etc., is one of the most important considerations you should make while looking for a home. The title is crucial since a bad title prevents someone from using a mortgage bank’s facility. When purchasing a property, it is a good idea to ask your mortgage bank for assistance.
4. Review the Interest Rate
Our interest rates at Infinity Trust Mortgage Bank Plc are quite competitive, and we offer lengthy terms that make repayment simple. If your income can support the repayment, we can borrow the amount necessary to purchase the house you want. Our equity contribution may be as low as 20% and may be paid on an hourly basis. In addition to the appealing rate, the client experience is outstanding.
On their websites, the majority of Nigeria’s mainstream Primary Mortgage Banks provide a working loan calculator. You can estimate your monthly amortization using the loan calculators. It is crucial to note that the calculator will provide you with an approximated number rather than a precise figure.
5. Build Your Equity
The amount you can immediately put toward the purchase of a property is known as your equity contribution. The availability of equity is one of the conditions for applying for a mortgage loan in Nigeria. Depending on the applicants’ creditworthiness or the risk assessment of their candidate profiles, mortgage banks do ask for equity contributions that range from 20 to 50 percent of the property’s value.
Therefore, you must ensure that you have some equity contribution if you intend to take out a loan to buy a property. To address this, certain primary mortgage banks provide specific products. For individuals who do not have the equity contribution readily available, Infinity Trust Mortgage Bank offers a product called Infinity Save and Own a Home that allows them to save it over time. This is done so that your savings will be set up to match your income and be practical for you.
- Take into account all other fees\charges
You should also figure out your usual monthly spending before committing all of your resources to applying for a mortgage application to buy a home. The maximum repayment amount should not be greater than one-third of your net income. You must take into account all additional costs associated with obtaining a mortgage loan, such as administrative fees, the cost of legal mortgage perfection, etc. These are just a few of the additional fees you may have to pay when applying for a mortgage loan. It would be prudent to inquire about the fees you would have to pay from your loan officer or account representative. It won’t be nice if you realize you won’t be accepted halfway through the application procedure.
- Begin gathering all necessary documents.
Once you have made the decision to apply for a mortgage loan, you may begin collecting the necessary paperwork that will be needed from you. A 6–12 month income account statement, an offer letter from a seller or developer (the developer in charge of the property you intend to purchase), a copy of your birth certificate or a sworn affidavit, a copy of your employment letter, a copy of your work ID, a copy of the title document for the property you intend to purchase, a letter of introduction from your employer, among other documents, will be requested from you. These are some of the materials they will need you to provide with your application. The earliest you can begin preparing these paperwork is when you approach the Mortgage Bank to apply for a loan. When these papers are easily accessible, the application procedure goes quickly.
- Consult a primary mortgage bank to submit an application for a mortgage loan.
When you have completed all of the aforementioned processes, the next thing to do is to contact a primary mortgage bank of your choosing based on the research you have done. A valid form of identification (driver’s license, national ID card, international passport, or voter’s card) and a utility bill, such as an energy or water bill, are required in order to open an account, which will be requested of you. Once the account has been opened successfully, you are ready to start the mortgage application. Your loan will be processed once you strictly adhere to the procedures and specifications outlined above, and you will soon be a homeowner.
- Make your belts tighter.
High levels of financial discipline are necessary to make the transition from getting a full monthly wage to loan payments. Depending on your ability to pay, repayment could take anywhere from five to ten years or longer. You must thus psychologically get ready for this and adapt your spending accordingly. It will require a lot of commitment and labor to take on this responsibility. However, the benefits are multiplied tenfold: seeing your family live well and seeing the results of your labor materialize a dream.
- Not having any debt
You’ll be able to unwind a little more and genuinely enjoy life once your mortgage loan is paid in full. You might consider going on vacation and engaging in activities you like. You can go on family vacations where you can spend time getting to know one another. Of course, paying your mortgage on time will help you avoid debt.
You can choose our Bank to submit your home loan application now that you are aware of the fundamental stages involved. You probably want to know why, out of all the Nigerian primary mortgage banks, you should pick Infinity Trust Mortgage Bank Plc.
The good news is that working with Infinity Trust Mortgage Bank Plc will give you access to a reliable mortgage bank that will help you at every stage of the process.
- Together with you, we’ll support you as you pursue homeownership.
- Assist you in finding houses that match your income.
- Flexible and negotiable payment terms are available to accommodate your individual needs.
- A professional and open guide.
- Make that the property has a title that is registered and will.