Friday, July 19, 2024

Co-op Bank giving Sh. 500k to Sh. 8mn loans to buy, build home at 9.9% reducing balance

Home ownership is the dream of every Kenyan who doesn’t have their own home. Most times, though, this dream appears farfetched. Not too many people have the right amount of money to build or buy a home.

It is this handicap that the Co-operative Bank has stepped in to solve. The bank currently has the cheapest mortgage plan in Kenya that come in at an interest rate of 9.9 per cent reducing balance.

“Whether you’re buying or building, we’ve got you covered with loans from Sh. 500,000 up to Sh. 8 million. Additionally, as a Co-op Bank customer, you can enjoy up to 90 per cent financing for building and 100 per cent for ready-built homes,” said Co-op Bank.

Co-Op post

The mortgage plan by Co-op Bank is aimed at availing affordable housing to persons who earn not more than Sh. 150,000 per month.

“Affordable housing loans are now available to customers for the purchase of developed residential homes as well as to undertake plot buy and build for residential homes,” said Co-op Bank in a statement to Bizna Kenya.

This plan is 3 per cent points cheaper than the average mortgage rate of 12.9 per cent that is  estimated by the Central Bank of Kenya to be the average mortgage rate in Kenya.


To be eligible for this plan, aspiring customers will need to have a maximum household gross income of Sh. 150,000. They will also need to have at least six months of consistent banking with the  Co-op Bank.

According to the bank, Kenyans who qualify will have the option of purchasing a ready residential house, buying a plot and building.

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A spot check on the terms of this housing loan shows that aspiring home owners will be financed for one unit. The security for the loan will be the property under purchase and the loan will go at a rate of 9.9 per cent per annum on reducing balance.

There will be a facility fee of 2 per cent of the loan amount that will be a one-off payment. “The maximum loan tenure will be for a period of 15 years for employed applicants, and 10 years for self-employed applicants,” Co-op Bank said in a statement to Bizna Kenya.

The minimum loan amount of will be Sh. 500,000 and the maximum loan amount will be Sh. 6 million for properties in the Nairobi metropolitan area.

The amount will drop to a maximum of Sh. 5 million for properties outside the Nairobi metropolitan area.  Interestingly, top-up loans will be allowable under commercial rate and upon repayment of the primary loan for a period of at least 12 months.

To access these cheap loans from Co-op Bank, you can visit your nearest Co-op Bank branch or give Co-op Bank a call via:  0711049739 or 0711049811, or email [email protected] for more details.

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