Act 3 of 1992 established the National Housing Fund (NHF).
Section 2 of the Act outlines the aims and objectives of the fund. Sections 20, 21 and 22 defines the offences and penalties for non-compliance. Act 3 is being amended to bring it in line with new realities aimed at strengthening the National Housing Fund.
Get access to the NHF Act.
The NHF scheme is for Nigerians in all sectors of the economy, particularly those within the low and medium-income levels who cannot afford commercial housing loans e.g. civil servants, traders, artisans, commercial drivers, etc. Any intending beneficiary must be a registered contributor and up to date with his/her contributions.
How can only 2.5% of my monthly basic salary or income be sufficient to obtain a loan, to build a house?
The 2.5% of the monthly basic salary contribution qualifies you to access the loan. The pool of funds created by the contributors nationwide becomes available to any contributor to borrow from, after contributing for a minimum of six months.
How does a contributor obtain an NHF loan?A contributor interested in obtaining an NHF loan applies through a registered and duly accredited mortgage loan originator (e.g. Primary Mortgage Banks), who packages and forwards the application to FMBN.
Is it the monthly contributions that determine the loan's amount?No. the loan amount is determined by the applicant's affordability. This entails his/her income level that will enable repayment of the loan.
What are the documents required when applying for the loan?NHF housing loans are repaid in monthly installments from the income of the beneficiary. This mode of repayment has the advantage of being both affordable and convenient.
Can a contributor obtain NHF loan, if a mortgage loan originator is not in his/her state?Yes. A prospective applicant can liaise with a mortgage loan originator (e.g. PMB etc.) in Nigeria to process a loan application.
Are there restrictions as to where a contributor can build his/her house?The property can be located anywhere in Nigeria. The applicant must however provide acceptable title documents to the land.
How can a low income earner get collateral for the loan?The only collateral is the property to secure the loan for. No other collateral is needed for the loan.
How many times can I get NHF loan?A contributor can only obtain an NHF loan facility once in a lifetime.
What is the maximum loans amount and repayment time for NHF loans?A contributor is eligible to access a maximum loan amount of =N=15 million repayable over a maximum period of 30 years at an affordable interest rate of 6%.
Can I obtain NHF loan to purchase a piece of land to build a house?No. A prospective applicant who wishes to obtain a loan to build a house is expected to have his/her land as well as an acceptable title to the land prior to the application for an NHF loan.
Can I get the loan as an individual to build my house or must I buy a government owned estate or from a private estate developer?
Yes. You can apply as an individual for an NHF loan to develop a land or buy directly from government consort estate or private estate developers.
Can the Bank finance building of staff quarters and students hostels in Higher Institutions of Learning?
The bank can finance the building of staff quarters and student hostels in Higher Institutions of Learning if they are under a registered Co-operative body which makes them eligible to access the Cooperative housing development loan (CHDL) and subsequently purchases the funded houses through NHF. Students’ hostels are currently not financed by the bank since they are transit accommodation. However, the bank is making the necessary arrangements in regard to funding of students hostels in the near future
Can self-employed NHF contributor access the NHF Construction loan?Yes, self-employed NHF contributors can access construction loan to develop their personal residential properties.
Can Right of Occupancy (R-of-O) be used to access NHF Construction loan?Yes, R-of-O can be used as a title document on the condition that the owner will submit evidence of processing the Certificate of Occupancy (C-of-O) and the undertaking that the C-of-O will be deposited in the Bank when it is obtained.
Can a Cooperative Society apply for CHDL using in-house professionals?Yes, a Co-operative Society can use its own in-house professionals to access CHDL as long as they are qualified professionals and possess the necessary certifications and experience.
Can letter of Grant issued by the State ministry of lands and Housing serve as collateral in accessing Construction and NHF loans?
No, the Bank does not accept letter of Grant in accessing construction and NHF loans.
Why is FMBN not building houses directly for NHF contributors instead of financing the Estate Developers?
It is not within the mandate of FMBN to construct houses directly for NHF contributors.
How can I edit my profile details on the FMBN Mobile App or USSD platform?Customers cannot edit their profile on these platforms however they can do this through the Update Form available on the FMBN website, or by visiting the nearest branch office for the update.
How can a contributor retrieve his/her NHF participation number?Yes, Staff in our Branch offices have access to an application to produce statement of account for Federal Workers
Why does it take so long for loans to be approved and disbursed from the date of application?This can be affected by 3 factors
Why does the Bank insist on using only ⅓ of an applicant’s income for servicing NHF loan even though he can accommodate more than ⅓ ?
This is labor law in Nigeria that no organization can deduct more than ⅓ of an applicant’s monthly income on any loan. Labour Act, 1974 stated that “any other provision of this Act, the total amount of deductions that may be made from wages of a worker in any one month shall not exceed one-third of the wages of the worker in that month".
What measures are in place to safe guard loan applicants from the sharp practices of some PMB’s?FMBN is working with the PMBs to harmonize all charges and to also educate applicants on all official charges.
Can I use a Deed of Assignment or any other legal document as Collateral for NHF Loan in place of Certificate of Occupancy?
Yes, because Deed of Assignment is a document that transfers ownership when it is duly registered.
Can my pension contribution be used as my personal stake?No, pension contribution cannot be used as an equity contribution or personal stake.
Can a person working with a Non-Government Organization (NGO) enroll into the NHF Scheme and benefit from it considering the contract nature of his employment?
Yes, the person must be a consistent NHF contributor for at least 6 months.
Why do I have to wait till I am 60 years of age to get my NHF refund?The NHF Act states that NHF contributions can only be refunded to a contributor that has attained 60 Years of Age or has put in 35 years in service.
Why is NHF Refund for Federal workers and other contributors not decentralized?NHF Refunds for Federal workers and other contributors are not decentralized as their contributions are centrally collected through IPPIS.
How does a self employed benefit from the Bank’s Rent-to-Own (RTO) product?The Rent-To-own Product is structured for the formal sector such that Rental payments will be deducted at source by the employer, as such, self-employed are not eligible to apply for Rent-To-own.
Can a contributor apply for NHF loan after benefitting from HRL?A contributor can apply for an NHF loan after benefitting from HRL however, such contributor must have liquidated the Home Renovation Loan granted to him or her.
Can a contributor apply for HRL more than once in his life time?Yes, HRL is a revolving loan. A contributor can apply for an NHF loan upon liquidation of his or her existing Home Renovation Loan.
However, at the point the contributor owns a house through either of the Bank's windows (NHF or RTO), he can not apply for an HRL loan any longer.
Can a self employed/an Informal Sector Cooperative member apply for HRL?The Home Renovation Loan is structured for the formal sector such that the loan repayment will be deducted at source by the employer, as such; an Informal Sector Cooperative member and self-employed individuals are not eligible to apply for Home Renovation Loan.