Owning a decent home in Kenya remains a distant dream for most middle and low income earning Kenyans. For instance, a three-bedroom house in Kilimani costs anything from Sh. 11.8 million to Sh. 12.8 million. A two-bedroom flat in Spring Valley goes for upwards of Sh. 25 million. Prices in Eastlands are no better, with a four-bedroom house in Fedha Estate in Embakasi going for around Sh. 30 million.
But this need not discourage you from deviating from you home ownership deal. This is because there are ways you can access funding and built your own home according to your needs and preferences. One of these ways is through the mortgage and construction loans that Co-operative Bank has set aside to help potential home owners actualize their dreams.
Already, the Co-operative Bank has made a major stride towards partnering with the national government in the implementation of the Big Four housing agenda. In august 2018, the bank’s board of directors approved Sh. 200 million capital injection into the Kenya Mortgage Refinance Company. This is the mortgage refinancing vehicle that the national government established as a key driver in the mobilization of affordable financing for the project.
“Whereas the government has kicked-off the initiative of the Kenya Mortgage Refinance Company (KMRC) to source for long-term financing to fund the provision of affordable housing to the majority of Kenyans the Co-op Bank Group expects to play a critical role on this key social and economic agenda,” said the bank.
The Co-op Bank also has the Good Home Mortgage product which:
- Allows both labour and fixed sum contracts subject to the amount sought.
- Considers projected rental income in assessing loan repayment ability.
- Facility drawn in tranches allowing one to only pay interest on the drawn amount.
- Mode and structure of disbursement on re-imbursement basis to ensure proper project implementation and completion.
- Accommodation on ample grace period for principal servicing up to 18 months based on project magnitude.
- Has upfront disclosure of all processes and charges for your benefit.
- Combines both variable and fixed rolling mortgages, which gives you the benefit of choosing what interest regime is good for you. In short, we have a two-in-one mortgage facility.
- Special products targeting the rural population who would like to develop affordable but decent homes. These include offering wholesale mortgages and technical support to housing co-operatives to lend to their members.
- Redefined turnkey projects to also include individuals who team up and wish to construct houses under structured projects for owner occupation.
The features of the mortgage and construction loans are:
- Competitive interest rates
- Affordable installments with a repayment period of up to 20 years
- We also give you a moratorium (grace period) of six months
- The house you purchase can be used as collateral and its rental income can be used to repay the loan
The requirements include:
- Copies of identification documents, that is, Memorandum and Articles of Association as well as a Certificate of Incorporation (for registered companies)
- Business Registration Certificate
- Identity cards for borrowers who do not have registered businesses
- Identity cards for directors of registered companies and registered businesses
- Bank statements for 6 months
- Audited accounts for loans above Sh. 5 million
- Resolution to borrow (for registered companies) and details of business location
- Necessary approvals by City Council, the local authorities, NEMA and securities to be provided
To apply, you may visit your nearest Co-op bank branch or CLICK HERE