Nigeria to Announce Details of Mortgage Company

Nigeria’s government will announce tomorrow its plans to develop a mortgage finance company along the lines of the U.S.’s Fannie Mae that will help broaden access to home loans.

The Nigeria Mortgage Refinance Co. (NMRC) will sell bonds on capital markets and provide long-term financing to lenders that will help them extend more home loans, according to an e-mailed statement from the Mercury PR company, acting for the government. It will also have an “oversight function to standardize mortgage lending practices,” it said.

The company to be launched by President Goodluck Jonathan at the Presidential Villa, in Abuja, is expected to help create over 200,000 mortgages over the next five years at affordable interest rates, extend maturities for Nigerian home-buyers to as much as 20 years, encourage the building of 75,000 new homes a year and create at least 300,000 jobs, according to the statement.

According to the Ministry of Finance which is to midwife the programme, it will begin in 14 pilot states where the state governors had agreed to provide fast-track land titles, foreclosure arrangements, and serviced plots.

Nigeria has been seeking to expand financing to help address a housing deficit in Africa’s second-biggest economy. The Federal Mortgage Bank of Nigeria (FMBN) said last month it was in talks with two Chinese lenders for credit of as much as $6 billion. In November, the government accepted a $300 million loan from the World Bank’s housing unit.
To contact the reporter on this story:
Chris Kay in Lagos at ckay5@bloomberg.net

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