Most Nigerians that are abroad are yearning to have their own homes back in Nigeria and are often at a loss because they want a mortgage loan from Nigerian banks. Contrary to what most people believe, getting a mortgage in Nigeria is not such a difficult task, provided one can meet the bank’s requirements, especially while living abroad. Often, the difficulty arises from the bureaucratic bottleneck that is involved in securing these mortgages. However, if one follows these steps, securing a mortgage will be easy.
To start the process you need to to go to the bank to secure the loan in person. You can get a friend or relative to pick up the forms and courier or scan them to fax or email to you so that you will have the necessary documents. You must also have collateral, which you will use in securing the loans. Typical things used for collateral include a house, landed property, and shares certificates. The value of the collateral largely depends on the amount you are borrowing from the bank.
Documents You’ll Need
Some of the necessary documents you will need to apply for include your international passport, your resident permit in the country where you are staying, proof that you are gainfully employed in your country of residence, and your tax clearance. When you are filling out the application form, make sure that you provide accurate information, as giving the wrong information could lead to your application being denied. This has been a major problem encountered by people while trying to secure loans.
When returning the form, ensure that you have:
- Fully completed the Home Loan application form (signatures verified)
- Your pay slips from the last 3 months
- Immediate past 12 months salary account statements, if you are a new customer
- Letter of introduction from employer’s HR
- Copy of company ID card
- Copy of valid means of identification (international passport, driver’s license or national ID Card)
- Copy of title documents to the property (if being used as collateral)
- Valuation report from a Bank approved valuer
- Details of any existing loans
- Proof of loan purpose
- Most recent utility bill
- Guarantor’s letter (two guarantors are required)
Self-employed applicants can follow this same procedure. There is undoubtedly much work that must be done to acquire a mortgage in Nigeria, especially if you are currently living abroad, but if you follow the steps and take your time, your efforts will certainly be rewarded.
Most bankers advise that it is imperative for anyone who wants a mortgage to purchase land first. This will show your readiness to build and it will also serve as collateral in case you default on your loan.
After buying the land, you must ensure that it is properly documented. You will need the necessary documents such as the certificate of ownership (C of O) and the receipt you received upon purchase of the land. Another important aspect for securing a loan is hiring professional builders to handle your project. This is important because the bank knows you will not have time to monitor the project all by yourself, so you will need to hire competent people to do so. The contractor will also serve as your guarantor by assuring the bank that the loan will be used for the building.
Applying For the Loan
You need to approach the bank and apply for the loan. While applying, inform them that the loan will be given directly to the contractor who will then use it solely for building on the property. You should also bring the building plan with you. Every bank is jittery about handing out loans and it will be just as difficult for Nigerians abroad as Nigerians at home to obtain one. Another way of quickening the process of being granted a loan is to inform the bank of what method you will be using to pay it back.
Getting a referral from your work place overseas will be very helpful in securing you a loan from the bank. After getting the loan, the bank will have to personally monitor the progress of the project to ensure that it is being done satisfactorily. You must also carry out your own monitoring of the project to ensure that the contractor is following the specified instructions.
The house as well as the land will serve as the collateral. Your credibility and credit worthiness will also serve as the collateral.
Special care should be taken when submitting documents to the bank. It is strictly against the law to use fake documents, and doing so could lead to arrest and prosecution.