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Which Bank is Best for Home Loan Application in Nigeria?
The battle line has been drawn. The players are out. The audience is cheering. The lights are on. It’s almost time. Everyone is anticipating.
The only thing everyone awaits now is for the battle to begin. And what is this battle? The battle between home loan and mortgage banks in Nigeria, to determine which is best for home loan application in Nigeria.
It’s a tough challenge because mortgage banks in Nigeria are doing pretty well. So everyone is eager to see what each player will bring to the table.
Well, today is the day. The games are about to begin. And we shall get to know which bank is best for home loan application in Nigeria.
Table of contents
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The Best Primary Mortgage Banks for Home Loan Application in Nigeria
Primary Mortgage Banks in Nigeria were established in 1989 by Decree No. 53 of The Mortgage Institutions Decree. As the name implies, these banks were established primarily to provide loanable funds at an interest rate to individuals and corporate clients.
Primary Mortgage Banks were initially financed by the Federal Mortgage Bank of Nigeria. However, with the establishment of CBN’s Other Financial Institutions and Supervision Department (OFISD), The Central Bank of Nigeria is currently in charge of the licensing and supervision of Primary Mortgage Banks in Nigeria. Some of the licensed Primary Mortgage Banks in Nigeria are:
- The Federal Mortgage Bank of Nigeria
- Aso Savings and Loans Plc.
- Abbey Mortgage Bank
- SunTrust Mortgage Bank
- Union Home Savings and Loans Plc.
- Infinity Trust Mortgage Bank Plc.
- Platinum Mortgage Bank
- Mayfresh Mortgage Bank
We assessed these banks based on loan options, efficient service, trustworthiness, customer satisfaction, and other factors, and came up with the top two (2) Primary Mortgage Banks for home loan application in Nigeria. We shall discuss these two in detail below
#1: The Federal Mortgage Bank of Nigeria
The Federal Mortgage Bank of Nigeria was established in 1956 under The Federal Mortgage Bank of Nigeria Act, Cap. E16 Laws of the Federation of Nigeria, 2010. It is the apex mortgage institution of Nigeria.
Though its main purpose is to grant long-term credit facilities to other Mortgage institutions in Nigeria, The Federal Mortgage Bank of Nigeria also provides home loans directly to Nigerian individuals. Thus, it is both a player and a financier in the mortgage market.
Advantages of the Federal Mortgage Bank of Nigeria
The following are the advantages of the Federal Mortgage Bank of Nigeria:
- It grants a long-term credit facility
- It charges a considerably low interest rate, compared to what is charged by Primary Mortgage Banks and commercial banks
- It has several branches across Nigeria, which enhances accessibility
- A large portion of its share capital is owned by the Government and its agencies, thus making it a trustworthy institution
- The home loan application process is smooth and transparent
- It is an old and trusted bank
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#2: Infinity Trust Mortgage Bank Plc
Established almost twenty (20) years ago, Infinity Trust Mortgage Bank gives every Nigerian an opportunity to become a homeowner by providing unique mortgage plans suited to each customer’s income, no matter how small.
In 2014, Infinity Trust Mortgage Bank rose to a National Mortgage Bank, having equity in the Nigeria Mortgage Refinance Company (NMRC). It is currently one of the leading Primary Mortgage Banks in Nigeria, providing accommodation to over 20,000 Nigerian families, and financing over twenty (20) estates in Nigeria.
Advantages of Infinity Trust Mortgage Bank Plc.
The following are the advantages of Infinity Trust Mortgage Bank Plc. for home loan application in Nigeria:
- Interest rates are moderate
- Mortgage services are personalized and offered to suit each customer’s needs and stream of income
- The home loan application process is highly transparent, easy and streamlined
The Best Commercial Mortgage Banks for Home Loan Application in Nigeria
Some commercial banks in Nigeria, aside from their primary banking business, also offer home loans to individuals who wish to purchase their dream property. Although most commercial banks loan at high-interest rates, customers are still drawn to them for the following reasons:
- Most commercial banks have several branches in various parts of the country, thus making them accessible. You would usually find two commercial banks before you find one primary mortgage bank.
- Commercial banks often offer special privileges to customers who own an account with their bank before the need for a home loan.
- Commercial banks provide unique home loan options.
We assessed the commercial mortgage banks in Nigeria based on efficient service, loan options, trustworthiness, customer satisfaction, and other factors and came up with the top two (2) commercial mortgage banks for home loan applications in Nigeria. We shall discuss these two in detail below
#1: The First Bank of Nigeria
The First Bank of Nigeria offers a range of easy mortgage options to individuals and business owners. They are famous for their joint mortgage loan, which enables partners to purchase properties by combining their resources.
Advantages of The First Bank of Nigeria Plc.
The following are the advantages of First Bank of Nigeria Plc. for home loan application in Nigeria:
- They offer a flexible repayment structure, tailored to each individual or couple’s affordability
- The interest rates are affordable
- The joint mortgage plan boosts a couple’s chance of owning their dream home sooner, as they combine resources to pay the equity contribution and to repay the loan faster
- The home loan application process is smooth and transparent
#2: Standard Chartered Bank Plc.
A subsidiary of Standard Chartered Bank Plc, United Kingdom, Standard Chartered Bank of Nigeria is a fast-growing bank with branches nationwide. From 1999 to date, Standard Chartered Bank has offered Nigerians a wide range of financial services, including digital and transaction banking, wealth management, and mortgages. It is another leading bank for home loan application in Nigeria, offering ease, unique offerings and customer satisfaction.
Advantages of Standard Chartered Bank Plc.
The following are the advantages of Standard Chartered Bank Plc. for home loan application in Nigeria:
- You can transfer your existing mortgage from another loan facility to Standard Chartered Bank
- The equity contribution is minimal—only 20% of the underlying property value
- You can top-up on your existing mortgage loan
- Standard Chartered Bank also offers the joint mortgage option for spouses
- The interest rate is 18% per annum, with up to 20 years of repayment term
- Mortgages are available for properties valued up to ₦250M
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Frequently Asked Questions
Which Bank in Nigeria Can I Apply for a Home Loan?
Some Primary Mortgage Banks in Nigeria include: Aso Savings and Loans Plc., Union Home Savings and Loans Plc. and Infinity Trust Mortgage Bank. Some commercial banks in Nigeria also deal with home loans, such as First Bank of Nigeria, Standard Chartered Bank, Union Bank of Nigeria, United Bank of Africa, Stanbic IBTC Bank, and Access Bank.
Can I Start a Home Loan Application in Nigeria Without Collateral?
No. Home loans are always secured. This means you must provide some form of collateral as security before the loan can be advanced. In most cases, this security is the title of the property to be purchased.
Do I Need to Have an Account with a Commercial Bank Before I Can Secure a Home Loan in Nigeria?
Yes. If you don’t have an existing account with the commercial bank from which you want to take a loan, they will demand that you create one.
What Documents Do I Need for a Home Loan Application in Nigeria?
The documents you need for a home loan application in Nigeria will vary based on your service provider. However, these are some common documents often requested: An offer letter from the current owner or developer of the property you want to purchase, title documents, a building plan, your employment letter, your office identification card, an introduction letter from your boss, a bank statement, an irrevocable grant to your salary account until the loan has been fully repaid, a birth certificate, and the Home Loan Application form.
And May the Best Bank Win
There you have it—the pros and cons of mortgage institutions in Nigeria. The game is over, and these are our finalists. We will leave it to you to determine the number 1 champion—the bank you will choose for your home loan application. We do hope, however, that this article will help you make an informed decision.
No matter the next step you are taking financially, we are always here to guide you through. Let us know your questions, and we will be happy to offer lasting solutions.
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