FMBN, FHA to sign MOU on national housing schemes



In search for ways to meet government’s obligation of providing affordable housing to the teeming population, the Federal Mortgage Bank of Nigeria (FMBN) and the Federal Housing Authority (FHA) have agreed to sign an Memoradum of Understanding (MOU) to meet the President Muhammadu Buhari’s annual target of delivering one million housing units.

The institutions also agreed to jointly explore opportunities for housing delivery through a number of on-going housing schemes such as the Accelerated Housing Scheme for selected federal MDAs, the Federal Integrated Staff Housing (FISH) Scheme for federal civil servants amongst others.

This was the resolution reached at a working visit of the management of the Authority to FMBN. At the meeting, FHA Managing Director, Prof. Mohammed Al-Amin noted that FMBN and FHA have a long history as a result of the complementary roles each play in the housing delivery chain.

He pointed out instances where FMBN granted the FHA an Estate Development Loan to construct over 250 housing units at the Obada-Oko Estate in Ogun State and mortgage loans at concessionary interest rates to its subsidiary, FHA Mortgage Bank Limited, under the National Housing Fund (NHF) scheme.

In his remarks, FMBN’s Acting Managing Director/Chief Executive, Mr. Richard Esin identified the funding of mortgages for affordable housing for the Nigerian mass market segment as a key business focus of the Bank.

He noted that in order to create the required synergy, FMBN is to provide funding for housing development on land banks held by FHA nationwide and expressed optimism that the collaboration between the duo provides the best synergy for delivering housing for the mass market segment for contributors to the National Housing Fund (NHF) Scheme.

In a related development, the Federal Mortgage Bank of Nigeria (FMBN) and the Nigerian Mortgage Refinance Corporation (NMRC) are to collaborate towards strengthening the secondary mortgage market and the Nigerian housing sector in  general.

In a related development, Esin informed the NMRC Chief Executive, Professor Charles Inyangete that FMBN is refocusing its business model to address the lower end of the income ladder with emphasis on the mass market for housing delivery.

Speaking when he received Inyangete in his office, he said this would be achieved by taking advantage of the concessionary (below-market) mortgage loan terms under the National Housing Fund (NHF) Scheme managed by the Bank.

The NMRC Chief Executive expressed the hope of more positive interaction and the need for synergy between the institutions, which are set up to address different income segments of the Nigerian mortgage market.

Notwithstanding the different market segments served by FMBN and NMRC respectively, it was noted that the challenges faced are common to the Nigerian Housing/Mortgage sector and therefore requires that both institutions adopt a collaborative and complementary approach to addressing such issues.

Consequently, areas for a common synergy that were identified at the meeting include the review of land and property registry practices for time and cost-effectiveness, the enactment of a foreclosure law to mitigate mortgage lending risks, the introduction of industry-wide uniform underwriting standards and the development of a data collection system for the Nigerian mortgage market. Both institutions agreed to set up a committee to further explore and deepen their relationship along the identified areas slated for collaboration.

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