NHF Estate Development Loans:

We assist and partner with developers to access multi-units housing estate development loans at concessionary rate of 10% per annum from Federal Mortgage Bank of Nigeria. The interest cost savings are passed to the buyers and also integrated into mortgage finance from us.
 
 
CONDITIONS FOR OBTAINING ESTATE DEVELOPMENT LOAN BY DEVELOPERS
 
In line with the Federal Government program for Mass Housing Scheme (MHS), the Federal Mortgage Bank of Nigeria has evolved an arrangement to assist Estate Developers in constructing affordable housing units for the average Nigerians. Such developers would acquire land and title from governments, provide necessary infrastructure, develop the affordable housing units, identify a PMI that would market the units and put in place, a sound post implementation arrangement for the estate.
The root title of the estate land would be sub-leased to the ultimate beneficiaries. This arrangement is to remove constraints being encountered by average Nigerians in obtaining land and titles for residential purposes.
 
To qualify for an estate development loan from the Bank, an Estate developer has to meet the following conditions :-
 
1.      The loan is for residential housing estate development only, at an interest rate of  (ten) 10% p.a. (on annuity basis) and for a tenor not exceeding 24 months subject to revision.

2.     The Bank does not finance Infrastructure facilities. Developer is expected to submit financial plan and budget for the provision of infrastructure in the housing estate.

3.     The proposed estate must have good title that can be sub-leased to individual allottees / purchasers of the housing units therein.

4.     Housing units under the proposed project must fall within the target price not more than N5.0 million so that they can be affordable to NHF contributor / buyers within the range of low - to - medium income earners. These units shall be in line with type plans specified by FMBN. Units falling outside the target type plans must be financed from the resources of the developer.

5.     There must have been firm commitment from buyers / allotees of the housing units. For this purpose, a named accredited Primary Mortgage Institution is to be identified in order to facilitate introduction of the project to prospective buyers / alloteess who must be contributors to the national Housing Fund (NHF). The associated PMI must confirm the relationship and forward a marketing plan for the disposal of the housing units.

6.     A financial projection to suit the proposed financial arrangement on the project must be provided. The projection must include developer's equity participation on the project at the present rate of 10% p.a.

7.     The Security for the Loan is an acceptable Bank guarantee.

8.     The following documents should be submitted with the loan application package
         to the Bank :

           ¨ Certificate of Incorporation.
           ¨ Photocopy of Articles and Memorandum of Association of the company
             (estate developer) with certified true copies of Forms C02 and C07
             attached.
           ¨ Detailed Profile of the company including:
           ¨ List of Board of Directors (Names, Position and Profession in Table form)
           ¨ List of Share holding profile of the Board of Directors and others.
           ¨ List of Management Staff including rank, designation, profession, qualification
             and years of experience.
           ¨ Technical Team if different from management staff.
           ¨ List of Projects Executed by the developer indicating Location, Name of
             Estate, House Type, number of housing units and cost.
           ¨ Audited annual accounts with the signature, seal and certification stamp of the
             Auditors, for the previous three (3) years.
           ¨ Photocopy of Tax Clearance Certificate of the organization for recent three
             years.
           ¨ Photocopy of registered title document on the land for the proposed project.
           ¨ Approved building and layout plans
           ¨ Resolution of the State Executive Council as well as a motion of the State
             House of Assembly approving the application for a loan from FMBN for a
             State Housing Agency.
           ¨ The Company's Board Resolution to borrow signed by the chairman and
              and companies secretary.
           ¨ Valuation Report signed by a registered Valuer on the proposed project.
           ¨ Priced Bill of quantities (BOQ), signed by a registered Quantity Surveyor,
             giving detailed cost estimate on the various housing types / units.
           ¨ Feasibility and Viability Development Report.
           ¨ Cash Flow Projection stating the current interest rate of 10% for the loan as    
              well as proposed periodic repayment.
           ¨ Project Work Program / plan.
           ¨ Detailed / Budgeted Cost and source of fund for the Estate Infrastructure and
             Amenity facilities.
           ¨ Letter of marketing commitment from a Primary Mortgage Institution (PMI) to
             be responsible for the disposal of the houses to the NHF contributions /
             allotees.

9.        Evidence of registration with the National Housing Fund as an employer and up
           to date remittance of employees' contribution to the Fund.

10.      Payment of a non-refundable Application fee of N20,00 (twenty thousand
           naira only) for applications for amounts below N50 million and a multiple
           of N20,000 on every further N50 million.

11.      Evidence of the membership of Real Estate Development Association of
            Nigeria ( REDAN) and financial contributions.

12.     A viable facility management for the proposed Estate and programme for its .
           sustainability.

13.     Any other relevant information that may facilitate quick consideration of the loan.