Available Mortgage Products
REBCo works closely with mortgage lenders in the Nigerian mortgage industry. Different
mortgage lenders have different mortgage products that they choose to promote.
REBCo seeks to appreciate its client’s needs and then match these needs to the
most appropriate product from the most appropriate lender in the market for that
particular prospective borrower or mortgage seeker.
Below are some of the most common mortgage products offered by Nigerian mortgage
lenders:
Outright Purchase of Completed Property
- Primary residence
- Buy to lease (investment property)
Outright purchase of a completed property is a popular product offered by most Nigerian
banks who are actively participating in mortgage lending. Here, the applicant
has identified a completed property that is habitable in its present state and is
ready to be moved into. The applicant is required to make a contribution also known
as equity contribution or down payment, which is a percentage of the total purchase
price. The equity contribution required varies from lender to lender.
There are typically 2 variations of this product. The applicant could be seeking
to purchase the property either as a primary residence or as an investment
property purchased to be rented out to tenants and could be resold at a
profit in future.
Purchase of Uncompleted Property (Typically developer scheme)
In some cases, the property the individual is looking to buy is not yet been completed,
It may still be under construction by the owner or developer. Some mortgage lenders
are willing to lend to this end under certain terms and conditions which vary from
lender to lender.
Equity Release (Unlocking cash from the property)
Equity release is a type of facility available to individuals who outrightly own the
property, and hold an unencumbered title over the property. Some lenders offer this
product to prospective borrowers who want to unlock cash from their property in
order to meet some other desired objectives such as injecting cash into their business,
embarking on or finishing another housing project or simply to meet other personal
needs. Terms and conditions vary from lender to lender.
Completion Loan
Some Nigerian banks also offer construction completion mortgage loans. These are
loans to individuals who are seeking to complete a housing construction project.
These are typically mortgage loans for completing one or at most a few units on
a plot or 2 of land. They are also typically shorter tenor in nature as the expectation
is that after construction one or two units are sold to repay the bank. Terms and
conditions vary from bank to bank.
Refinance Loan
Refinance loans are mortgage loans offered to an individual who already has an existing
loan running, typically with another financial institution. The new loan is usually
sought to enable the customer move from the more stringent features of the existing
loan to the more beneficial features of the new loan. These features could be longer
tenor, lower interest rates, lower fees etc. Most lenders do thorough due diligence
on the applicant to ensure that the existing loan being considered for a takeover
is actually a performing loan.