Emmanuel OchayiThe Federal Government has introduced a new mortgage scheme aimed at providing affordable housing for middle and low-income earners in Nigeria. This initiative, managed by the Federal Mortgage Bank of Nigeria (FMBN), seeks to address the country’s housing deficit and ease the financial burden of homeownership. With rising inflation and high property costs, many Nigerians struggle to secure decent accommodation. This scheme offers fresh hope for those in need of affordable housing.
Addressing Nigeria’s Housing Crisis
Housing remains a major challenge in Nigeria, particularly for low and middle-income earners. With inflation driving up building material costs and exchange rates affecting property prices, many find it difficult to afford decent housing. The introduction of the new mortgage scheme is a strategic response to this crisis.
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Although the National Housing Fund (NHF) was established to provide affordable housing options, enrolment remains low. The FMBN has therefore taken steps to improve accessibility and efficiency in mortgage financing, making it easier for more Nigerians to benefit from the initiative.
Increased Participation in the National Housing Fund
The FMBN has reported an increase in NHF collections, indicating renewed trust in the scheme. Contributions grew by N3 billion in 2024, bringing the total collection to N103 billion. Additionally, employer and employee registrations under the scheme have significantly increased. This progress suggests that more Nigerians are beginning to recognise the benefits of the NHF, paving the way for wider access to affordable mortgages.
Expanding Housing Access Across Nigeria
Under the new mortgage scheme, the FMBN has financed the completion of over 1,044 housing units, with an additional 6,853 units under construction in 106 locations nationwide. These developments are located in both urban and rural areas, ensuring that housing opportunities are accessible to all income groups.
Furthermore, the bank has allocated N100 billion to support the Renewed Hope Cities and Estates Programmes, starting with 3,112 housing units in Karsana, Abuja. This initiative aligns with the Federal Ministry of Housing and Urban Development’s agenda to boost housing development across Nigeria.
Introduction of New Mortgage Products
The new mortgage scheme includes several innovative products aimed at making homeownership more accessible:
Diaspora Mortgage Loan: This initiative, in collaboration with the Nigerians in Diaspora Commission (NiDCOM), allows Nigerians living abroad to invest in real estate at home. The scheme is expected to launch in the first quarter of 2025, with support from the Central Bank of Nigeria (CBN) and International Money Transfer Operators (IMTOs) to facilitate seamless transactions.
Rent Assistance Loan: This product is designed to ease the financial burden of rent payments for eligible Nigerians. It offers flexible and affordable financing options, making it easier for individuals to meet rental obligations. The scheme is expected to commence within the first quarter of 2025.
Non-Interest Loan: Specifically designed for Nigerians who do not want interest-based financing, this product caters to low and middle-income earners who prefer alternative financing options. It is expected to be launched by the end of the first quarter of 2025.
Improved Loan Processing and Digitalisation
One of the significant improvements in the new mortgage scheme is the reduction in loan processing time. Previously, applicants had to wait for months before receiving their mortgages. However, the FMBN has streamlined its processes, cutting the turnaround time to an average of 30 days.
This improvement is largely due to the bank’s digital transformation efforts. Loan applications are now processed online, reducing bureaucratic delays and improving transparency. Additionally, the FMBN has introduced mystery shopping to monitor customer service, ensuring that beneficiaries receive prompt responses to inquiries and complaints.
Future Plans and Expansion
The FMBN has ambitious targets for 2025, aiming to increase NHF collections to N211.33 billion by expanding contributions from informal sector workers and the diaspora community. The bank also plans to offer 4,200 new homeownership loans, including 2,500 non-interest Rent-to-Own facilities, 1,100 mortgage loans, and 200 Diaspora Mortgage Loans. Additionally, 15,122 home construction loans will be provided to support large-scale housing projects.
To improve mortgage processing efficiency, the FMBN is finalising the establishment of a National Mortgage Registry. The bank is also focused on recovering outstanding loans, targeting N93.7 billion in recoveries in 2025.
Emmanuel Ochayi is a journalist. He is a graduate of the University of Lagos, School of first choice and the nations pride. Emmanuel is keen on exploring writing angles in different areas, including Business, climate change, politics, Education, and others.
