Government Programs and Initiatives to Make Mortgage Financing More Accessible and Affordable in Nigeria

Owning a home is a dream for many Nigerians, but the cost of purchasing or building a house can be a significant barrier to achieving this dream. To make mortgage financing more accessible and affordable, the Nigerian government has implemented various programs and initiatives. These programs aim to provide Nigerians with access to affordable mortgage loans, reduce the cost of building and buying homes, and increase the number of homeowners in the country.

In this article, we will take a closer look at some of the government programs and initiatives that have been introduced to make mortgage financing more accessible and affordable to Nigerians.

National Housing Fund (NHF)

The National Housing Fund (NHF) was established in 1992 by the Federal Government of Nigeria as a source of financing for the provision of affordable housing in the country. The NHF is funded by a 2.5% deduction from the monthly salary of Nigerian workers who earn at least ₦3,000 per month, and contributions from the Federal Government.

The NHF provides affordable mortgage loans to Nigerians at a maximum interest rate of 6% per annum. The maximum amount that can be borrowed under the NHF is ₦15 million, and the loan can be repaid over a period of up to 30 years. The NHF is administered by the Federal Mortgage Bank of Nigeria (FMBN).

Family Homes Funds

The Family Homes Funds is a social housing initiative of the Federal Government of Nigeria aimed at providing affordable housing for low-income earners and those who cannot afford to buy or build their own homes. The Family Homes Funds was launched in 2017 with a target of providing 500,000 affordable homes by 2023.

The initiative is funded by the Federal Government, the Central Bank of Nigeria (CBN), and the private sector. The Family Homes Funds partners with developers to build homes and offers mortgage loans to Nigerians at affordable rates.

Mortgage Refinance Company (MRC)

The Mortgage Refinance Company (MRC) was established in 2013 to provide long-term funding and liquidity to mortgage lenders in Nigeria. The MRC provides mortgage refinancing to mortgage lenders, which enables them to offer affordable mortgage loans to Nigerians.

The MRC provides long-term funding to mortgage lenders at a fixed interest rate, which helps to reduce the cost of borrowing for Nigerians. The MRC also works with the Federal Government and other stakeholders to develop policies and initiatives aimed at improving the mortgage industry in Nigeria.

The Federal Government Social Housing Scheme

The Federal Government Social Housing Scheme is a program aimed at providing affordable housing for low-income earners and those who cannot afford to buy or build their own homes. The program was launched in 2020 with a target of providing 300,000 affordable homes across the country.

Under the program, the Federal Government partners with developers to build homes and offers mortgage loans to Nigerians at affordable rates. The program also provides grants to developers to reduce the cost of construction and make the homes more affordable.

Conclusion

The Nigerian government has introduced various programs and initiatives to make mortgage financing more accessible and affordable to Nigerians. These programs aim to provide affordable mortgage loans, reduce the cost of building and buying homes, and increase the number of homeowners in the country. While these programs have made progress in improving access to affordable housing, there is still more work to be done to ensure that every Nigerian has access to safe, decent, and affordable housing.

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