What is NHF?
NHF (National Housing Fund) is a scheme created by the Federal Government for Nigerian workers, to help them access flexible financing to get their own homes. The scheme was established by the NHF Act of 1992 and is administered by the Federal Mortgage Bank of Nigeria (FMBN). With NHF, Nigerians can access a single-digit low interest-housing loan and utilise it for the purchase, construction, renovation or expansion of their residential buildings. It is a statutory contribution that stipulates that all Nigerians earning the minimum national wage and above, should contribute 2.5% of their basic monthly salary to the fund.
Can self-employed individuals’ access NHF?
Self-employed individuals can also apply for and access NHF loans as long as they have been making the statutory contribution of 2.5% of their basic monthly salary, and remitting same to the fund.
How are contributions made?
Employers are required to deduct 2.5% from the monthly salaries (basic) of their workers and remit same to the Federal Mortgage Bank of Nigeria (FMBN) within one month of the deduction. While self-employed individuals are to pay their statutory contributions directly to the bank’s offices located in all state capitals. All payments are duly receipted.
How do I know the status of my contribution to the fund?
The Federal Mortgage Bank of Nigeria (FMBN) regularly provides annual statements of accounts to contributors to the fund. Contributors also have passbooks with unique participation number, which are updated by their respective employers after every deduction. This passbook shows the amount contributed at any given point in time.
How can I access a loan sufficient to build my own home, with just 2.5% of my basic salary?
The 2.5% contributions by all subscribers accumulate over time and form a pool of funds from which interested applicants can access housing loans. It is expected that only a fraction of contributors can obtain loans at any particular time.
How can a contributor access the NHF loan?
All applications for NHF loans are to be done via a duly accredited Primary Mortgage Institution (PMI). The PMI is then expected to package and forward each application to FMBN.
Is there a specific PMI that will handle the GreenPark-NHF transaction?
Yes, our mortgage partners for this product are AG Mortgage Bank & Trustbond Mortgage Bank. They will handle the processing of the NHF loan on behalf of each subscriber.
I already started processing my NHF for another project, can I still utilize it for GreenPark Homes Project?
No, you can only apply for NHF once. However, you can withdraw your application from your current PMI, as long as a disbursement is yet to be made, after which you can then start a fresh application with us to become a subscriber at GreenPark Homes.
Can my spouse and I apply for NHF together or separately?
No, you cannot apply jointly, each person will have to apply separately as long as they are both contributors to the NHF scheme.
I have once applied for NHF, but I collected less than N15,000,000, can I re-apply for the difference?
No. If you have collected an NHF loan before, you can’t apply again to get the difference. The funds you had earlier received was calculated based on your monthly earnings and the maximum amount-stipulated by law that could be accessed at that time. It was only recently that the loan amount was increased to N15m.
How do you calculate the amount a contributor is eligible to receive?
The loan an applicant is eligible for is based on the premise that he/she must not utilize more than one-third (1/3) of his/her gross monthly pay to service the loan. For example, a 35 years old applicant on a monthly salary of N60,000 interested in building a house estimated to cost N7 Million will have about 25 years, before clocking 60 years (which is the retirement age).
The available loan amount for this applicant will be calculated as below:
Loan ceiling = (N60,000/3) x 12months x 25years
= N 20,000 x 12 x 25
= N 6,000,000.00 (Less annuity interest factor of 6%)
The above scenario implies that the contributor will be able to access up to N 6,000,000 NHF mortgage.
What are the documents required to apply for an NHF loan?
The documents required to process the loan include:
- a) Completed application form
- b) Photocopy of title documents
- c) Current valuation report on the proposed house to buy
- d) 3 years tax clearance certificate
- e) Evidence of NHF participation (Minimum of 6 months)
- f) Copy of payslips for the previous 3 months
- g) Equity contribution
- What is the mode of repayment?
NHF loans are repaid on a monthly basis from the monthly salaries/income of beneficiaries.
Can a non-contributor access the NHF Scheme?
No. Only contributors with a confirmed record of six months remittances can access the loan. Interested individuals who want to kickstart their registration can visit FMBN office either at Ikeja, Apapa or Marina to obtain the card, and make the required payment before applying for the loan.
Is collateral required to qualify for the NHF loan?
The only collateral required from loan beneficiary is the property in question. No other collateral is needed to secure an NHF loan.
What is the maximum loan amount and repayment period for NHF loans?
The maximum loan an applicant can get is N15,000,000, which is payable over a maximum period of 30 years at an affordable rate of 6%. The tenor of the NHF loan will be dependent on the age of the contributor minus the retirement age of 60 years.
What advantages does an NHF loan have over commercial housing loans?
a) The major eligibility requirement is the provision of evidence of six months of contributions into the fund.
b) The loan covers a large portion of the cost of acquiring a home, and its flexible payment options make it a more attractive option.
c) Interests on NHF loans are lower. The interest rate for NHF mortgage is 6%.
d) The interest rate remains fixed throughout the loan tenor.
e) It offers a long period for repayment up to 30 years depending on your age.
f) Loan repayment is on a monthly basis.
g) It is easily accessible to low and middle-income earners.
h) You can change jobs without losing the benefits.
20. What happens to my previous contributions in the event of a job change?
Contributions are not lost in the event of a change of jobs or transfers. A duly completed NHF Registration Form (NHF II) is to be submitted to FMBN to indicate this change. The individual Registration Number, which is a permanent allotment, would then be transferred to the new employer to sustain the contributor’s records.
How does NHF work with GreenPark Estate?
It is a flexible scheme by Alpha Mead Development Company that allows you subscribe to a 3-bedroom terrace house, at GreenPark Estate by paying N100,000 monthly for 24 months for the equity, you can access up to N15,000,000.00 NHF mortgage at an unbeatable 6% rate. Repayment can be spread over the course of 30 years depending on the age of the subscriber.
What is the spacial configurarion of a unit of 3-bedroom terrace at GreenPark?
The house seats on a 206.88sqm land.
What does 3-bedroom advanced carcass terrace mean?
This means the full concrete work and roof of the 3-bedroom semi-detached house will be completed, and external painting done. All external windows and doors will also be fitted, and pipes for the electrical and mechanical works will be installed. This option allows you to finish the house to your standards and at your own pace.
What title does GreenPark Estate have?
It has a root title- C-of-O in favour of Ibile Holdings Ltd (the real estate arm of Lagos state), and a Deed of Assignment in favour of Green Park Development Estate (GPDE), which is the special purpose vehicle created for the joint venture between Ibile Holdings Ltd and Alpha Mead Development Company Ltd (AMDC).
Who is the contractor on the project?
MAHFAS is the contractor on the project, and the company was named “Best Contractor” by FMBN last year.
What title do I get for keying into the GreenPark NHF Product?
A Deed of Assignment will be assigned to each subscriber which will be delineated by a survey plan showing the area plan of the exact unit bought by the subscriber. This will, however, be in the custody of Federal Mortgage Bank of Nigeria as collateral for the NHF funds. They will handle the title perfection and legal mortgage perfection on behalf of the subscriber.
What is the cost associated with purchasing the property – 3-bedroom terrace house at Green Park Estate?
Property cost: N30,000,000 exclusive of tax. This comprises of an equity payment of N15,000,000.00 over the 6 to 24 months period and NHF loan disbursement of N15,000,000
Will I truly get NHF Mortgage at 6% after completing my equity payment? Is the loan guaranteed?
Once you subscribe to GreenPark Homes and provide all the necessary documentation, your access to the N 15million mortgage loan is guaranteed.
What is the cost associated with processing the NHF loan on the 3-bedroom terraces at Green Park Estate
a) Interest rate: 6% per annum
b) Credit search: N5,000
c) Valuation: N20,000
d) Documentation fee (title & legal mortgage): N40,000
The terms and conditions of the NHF loan will be outlined by our mortgage partners through an offer letter.
Is it compulsory I take a credit life insurance while taking the NHF loan?
Yes, as this insurance must be done by any individual that is interested in subscribing for a housing loan. This is done to insure the person taking the loan against death, permanent disability, critical illness, loss of job for nine months.
Why is fire and special peril insurance important?
This is a type of property insurance that insures the property against fire, destruction of the property or any form of natural disaster. This is based on property value.
What does my repayment schedule look like over a 24-month period?
Repayment schedule is hinged on the type of house you want to purchase. It starts at N100,000 monthly if a subscriber opts for a studio apartment and as low as N1,000,000 for a 3-bedroom semi-detached house.
33. What advantages does an NHF loan have over commercial housing loans?
The eligibility requirement is by merely contributing to the fund for a minimum period of six months. The loan covers up to a large portion of the cost of the house and can be up to a maximum of N15,000,000 and interests on NHF loans are relatively lower than prevailing market rates.
Other benefits include:
- Interest rate remains fixed throughout the loan tenor.
- It offers a long period for repayment of up to 30 years if your age can accommodate same.
- Loan repayment is on a monthly basis and can be regarded as monthly rent.
- The property serves as security for the loan and no other collateral is required.
- It is easily accessible to low and medium-income earners.