Frequently Asked Questions

What is a home loan?

It is a loan by a lender to the homeowner secured by a lien on the real estate.

Q: I want to buy my first home, but am unsure what to do first?
A: There are several steps you should take:
1. Look at your own financial situation. Establish a good credit history by paying your bills by the due dates - including your rent. Use credit sparingly and do not charge credit cards up to the limit. Try to save money for a down payment and closing costs. However, you should always have some cash in reserve to handle emergencies, moving expenses, turning on utilities, etc. 2. Decide how large of a house payment you feel comfortable paying each month. This generally gives a good starting point in pre-approving you for a mortgage.

Q: How long do I have to be on my job?

A: At least 6months, however, you must show income stability to handle the future mortgage payments. In underwriting a mortgage, emphasis is given to the last two years with no gaps in employment over 30 days. If you are self-employed, two years tax returns should be available.

What is a home equity loan?

It is a closed-end home loan secured by the borrowers residential asset. The reasons to usually get a home equity loanare to pay off debt or to make home improvements.

What is a home equity line of credit or HELOC?

A HELOC is simply an open-end loan, set up as a line of revolving credit for some maximum draw instead of a fixed loan amount in which your home is collateral. This is an open-end loan that permits the borrower to repay and re-borrow the funds available. HELOCs can be used to pay for several important items such as college education tuition, private school education, high interest debt, home improvements, home renovation, and major medical bills.

Is the NHF loan have tenor more than 10 years?
Does the NHF loan have tenor more than 10 years?

Yes. Subject to age and income of the contributor, the NHF loan can be accessed for a maximum period of 30 years.
Yes. Subject to age and income of the contributor. The NHF loan can be accessed for a maximum period of 30 years.

Is there a maximum amount that can be accessed by Contributors?

Under the NHF scheme, the maximum amount that can be accessed is N15mm.

Is there an age limit after which a customer becomes ineligible to benefit from the NHF Loan?

Yes. The age limit is 60 years, which corresponds to the retirement age in the civil service.

Can I use funds from the NHF to renovate an existing house?

Yes, you can apply for the purpose of renovation, as long as you have a certified Bill of Quantities (BOQ).

What is a reverse mortgage?

This loan program is for the benefit of senior citizens, giving them the ability to supplement their income. It is a contract between the lender and the homeowner in which the lender makes regular payments to a homeowner for a specific period of time. The monthly payment received by the homeowner is based on the amount of equity the homeowner has in the home. The monthly payment is a non-recourse loan. Hence, the payment is tax free to the homeowner. The homeowner is allowed to reside in the home until they relocate or till the death of homeowner. At that period, the lender sells the home and recovers his loan.

*What is a mortgage lender?

A mortgage Lender is a financial institution that provides prospective homeowners with the funds over a long-term period to pay off their home loan mortgage. Borrowers are required to pay monthly instalments to their lender which includes principal, interest, and additional lender fees. Examples, mortgage bankers and mortgage brokers.

What is a mortgage principal?

The mortgage principal is the amount of loan money that a homeowner borrows excluding interest. What does APR mean?
Annual Percentage Rate ( APR ) is the percentage used to figure out the total cost of your cash advance loan by taking into account all fees charged by your lender in addition to your loan principle and interest.

What is a fixed rate mortgage?
A fixed rate mortgage is a home loan with steady mortgage interest rates and monthly payments that do not change throughout the life of the loan.

What is the adjustable rate mortgage?

An adjustable rate mortgage is a mortgage loan whose interest rate is episodically adjusted based on an index. The monthly payments made by you may change during the term of your mortgage loan with the changing interest rate. The fluctuating rates pass on part of the interest rate risk from the mortgage lender to you.

What is an interest-only mortgage?

Interest-only mortgages are loans that require the borrower to pay only interest on the principle in monthly instalments for a fixed period.

What is an amortized mortgage?

Amortized Mortgages refers to loans that are paid in instalments comprised of both principle and interest, and which is paid off (or amortized) over a fixed period of time.

How do you calculate LTV or loan-to-value ratio?

The loan-to-value (LTV) ratio of your home is calculated by dividing the fair market value of your home by the amount of your home loan.

What are lender fees?
These fees usually range anywhere from 2 to 5 percent and may include, but are not limited to, things such as appraisal costs, document preparation, and application costs.

FAQs Real Estate


Who is a Listing Agent?

A listing agent works on behalf of the seller to market the property so as to attract potential buyers. Also, the listing agent is referred to as a seller’s agent.

Who is a Selling Agent?

A selling agent has an agreement with buyer to work for their best interest in a real estate transaction. Also, the selling agent is referred to as a buyer’s agent.

Who is a Dual Agent?

A dual agent represents the buyer and seller in the same transaction. The dual real estate agent must disclose to both parties the agent’s duel agency status before the process begins. The buyer and seller must agree in writing to the duel agency agreement before any business is transacted. Also, the agent cannot disclose either partys personal information with the other.

What is a Residential Purchase Agreement?

Also known as Contract to Purchase Real Estate, it is a binding agreement (among two or more parties) to purchase real estate. It binds the buyer to buy at a set price and the seller to sell to the buyer, all of which is to be transacted within a specified time.

Q: What is a sales contract?

A: This is a legally-binding agreement between buyer and seller which, when accepted by all parties, confirms the purchase price of the property. Usually the buyer places a small amount of money in deposit as good faith (called earnest money). Do not sign any sales contract unless you have reviewed it carefully and perhaps even had it reviewed by an attorney. A contract is often contingent upon many things, such as mortgage loan approval, inspections of well and/or septic systems, satisfactory building inspection and termite inspection. You should make sure your own rights are protected.

Q: Do I really need a building inspection?

A: If you are buying a new home, our real estate team will visit the property to inspect and advise you where appropriate. However, the older the home, the more that can be wrong with it. Care should be taken to inspect the following:
• The foundation for cracks and leaks
• The roof should have 3 to 5 years of remaining life
• The plumbing
• The electricity and other infrastructure

Q: In a fixed rate loan, can my payment ever change?
A: Yes, while the principal and interest stay the same, your taxes and insurance paid monthly will change according to tax assessments and increases in homeowners insurance costs.

Q: Should I wait until interest rates drop to consider buying a home?

A: Interest rates at this time are very reasonable. Sure, it would be nice to wait for a lower rate; however, at the same time, the price of the home can also increase. If you are ready to buy, NOW is the time to buy! We are always ready to assist you in the most important purchase of your life - owning your own home. Feel free to call upon any of our loan consultants to answer your questions and put you on the road to your home ownership!