By Alex C
The Federal Government is dedicating the first set of 10,000 mortgages that would come under the newly launched Nigerian Housing Finance Programme to first time home buyers, especially the young people.
The first 10,000 mortgages scheme was launched recently in an event that Ngozi Okonjo-Iweala, coordinating minister for the economy and minister of finance, said the Federal Government’s focus was to create employment, fight poverty and try to close up the huge inequality in the country.
Launched in January by President Goodluck Jonathan, the Nigerian Mortgage Refinancing Company (NMRC) is refinancing vehicle to provide mortgage lending with access to more liquidity and long term funds and at much lower interest rate than what is obtainable today.
The mortgage rates, analysts believe, would likely come as low as 13 percent to 13.5 percent at the first instance, while there is plan to drastically reduce that as the scheme goes on.
The processing time for prequalified loans, the minister said, which as at today runs from between 6 and 18 months has been cut down to 3 to 6 weeks, and in any case, not more than 2 months.
“We try to aim this scheme primarily at the first time home buyer who is on the market to purchase a home costing between N2 and N20 million. So we try to keep it low to address the first time buyer and above all, our young people. With the 10,000 mortgage scheme, Nigerians can now begin to realise their dream of owning a home and looking forward to improving socio-economic outcomes”, the coordinating minister added.
The finance minister said NMRC’s mission is to provide liquidity for longer term funding for the housing sector since the ability of banks to deliver mortgage services is limited by the fact that 80 percent of all bank deposits are for 30 days only.
According to her, the scheme is a private sector driven initiative which the Federal Government initiated with strong support from NMRC and primary mortgage institutions and implemented in partnership with 21 pilot states.