How to get a mortgage in Nigeria

Jan 08, 2024


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How to get a mortgage in Nigeria

Getting a house should be easy. But with thorough checks, primary mortgage institutions can reject your applications. This checklist helps you stay one step ahead and improves your chances of a deal.

Before we start on the checklist, there is a vital thing you should understand. It is not always guaranteed to get a bank to accept your application. Each bank has its own unique method of deciding whether to lend to you. Your chances of acceptance depend on whether you fit these criteria.

Banks check a variety of things, including:
a. The size of the mortgage you are applying for
b. The size of your deposit
c. Your income streams: Are you employed? Are you self-employed?
d. Your credit rating
e. Your debt-turnover ratio
f. If you are a contributor to the National Housing Fund


1. My credit report is good.

Your primary mortgage institution, or bank, will check your level of financial discipline before giving you a loan. To know this, they will check your credit report.

A number of credit reference agencies in Nigeria give banks access to your credit report. They are First Credit Bureau, CreditRegistry.Ng, and CRC Credit Bureau. They each collect relevant information about you, including your credit information. According to the Credit Registry, banks use this information "to determine loan applicants’ creditworthiness."

Banks check your credit report to determine if you are capable of making regular repayments. They want to know whether you are a reliable borrower.

Some of the information included in your credit report is:
Your name, date of birth, phone number, current address, and previous addresses
Types of credit accounts in your name
Your credit payment limits and credit balance
How much credit you have used over time.
Your credit performance, including regular payments, including any missed or late payments
Your credit score
Other public records.

You must check your credit report before your bank does. This way, you can get yourself in shape before applying. Credit bureaus allow you to order your credit report. You can do it online. For this, you need to provide a number of pieces of information about yourself, including your name, Bank Verification Number (BVN), RC number, and Tax ID.


2. I am a contributor to the National Housing Fund.

Nigerian mortgage applicants must contribute six months to the National Housing Fund. The NHF offers low-interest government-backed loans to employed Nigerians over 21. Programme participants must give 2.5% of their monthly salary to the fund. Thus, if you earn 1 million naira each month, you must contribute 25,000. Your PMI checks your NHF status to understand your savings pattern. Your house ownership account has to be operated for a specified duration, though it varies from one PMI to another.


3. My debt-turnover ratio is okay.

Also known as the debt-to-income ratio, this is a calculation of how much debt you can handle when your income has been considered. This helps banks understand if you can afford to assume more debt. Consider keeping your debt below 33% of your income. Maximum DTI ratio for mortgage eligibility is 33%. This means you can only spend 33% of your salary on debt repayment. Banks usually give you more preference if your DTI is lower. A good DT ratio demonstrates a good balance between debt and income. On the flip side, having a DT ratio above 33% shows banks that you have too much debt for the amount of income you earn each month. The lower the debt-turnover ratio, the better the chances that your mortgage application will be approved, or at least considered.

4. I have a tax clearance certificate.

Your tax clearance certificate shows that you do not owe tax within a specified period. It shows banks that you have cleared your owed tax and that you do not owe tax.

This is one of the requirements for you to access a mortgage in Nigeria.



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We try to make sure that the information here is accurate at the time of publishing. But the property market moves fast and some information may now be out of date. Zerodip accepts no responsibility or liability for any decisions you make based on the information provided. Graphics and images used here are for information purposes - we do not have ownership right over them.

How to get a mortgage in Nigeria

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