How To Buy Land Or  Property In Lagos Through Lagos State HOMS

Recently, land and property purchase has become easy, stress-free, and affordable through the Home Ownership and Mortgage Scheme (HOMS). It is the same scheme that controls the day-to-day activities relating to land and property purchase. 

However, there are certain processes to be followed while buying your land and property. Probably, you need to ensure that you inform your lawyer in due time to protect yourself from fraud. 

Meanwhile, you might be wondering how to buy land and property through HOMS, but no need to worry,  this article aims at outlining the ways you can buy them safely. 

Before more clarity on how to buy land and property in Lagos through Lagos State HOMS, let’s talk about HOMS. 

What is the Lagos State Home Ownership Mortgage Scheme (HOMS)

What is the Lagos State Home Ownership Mortgage Scheme

The Lagos State Home Ownership Mortgage Scheme was created by the Lagos State government to help indigenes, civil servants, lagosians become homeowners. The scheme is aimed at encouraging first time home buyers to become homeowners with a verifiable and legitimate source of income. 

The three banks selected to further the scheme are FBN Mortgages, Skye Mortgages and Zenith Bank Plc. The scheme has certain features such as;

• Down payment of 30% of the property cost. 
• Minimum tenure of 10 years and maximum of 20 years. 
• A fee of 10,000 for civil servants and 25,000 naira for others.
• Deed of mortgage acts as security over the property you wish to buy.
• The repayment plan involves an equal periodic principal repayment with interest to be paid on the reducing balance or an equal monthly installment of both principal and interest. 

Key Requirements to meet before applying for the Lagos State Housing Scheme

There are vital requirements to meet before one can be eligible to apply and participate in the mortgage scheme, you must meet these key criteria before you can be selected, these criteria are;

• RESIDENCE- You must have a traceable residential address in Lagos state and must have been living in lagos state.
• AGE BRACKET-the housing mortgage scheme has age limitations, you must be under 60 years of age to be eligible to apply for this mortgage scheme.
• JOB OR BUSINESS-to be eligible to apply, you must be working or have a verifiable business, you must have a confirmatory and verifiable source of income, your source of income must be dependable.
• Employee Status: if you are an employee, there is no way you can be eligible to apply if have not worked for your current employer for six months, a letter of confirmation from your employer, must be cited and provided by you before you can apply.
• Interest payment: As a beneficiary, you are to pay a 6% interest rate on the mortgage loan, and the loan will be disbursed
• TRANSFER LIMITATION-A beneficiary of this scheme cannot transfer the property, or even rent it out or sub-let it until the ownership is fully acquired.
• If your application is successful, you are expected to pay 30% equity of the cost of the property you are acquiring. 
• You must also be a first-time home buyer

Other Key Processes to take while applying for the Lagos State Home Ownership Mortgage Scheme;

• Interested applicants must follow these key processes to by obtaining a form from the Ministry of Housing or download form from the Lagos State Government website.
• Applicants should fill the form and submit to the Ministry of Housing accompanied with payment of N1,000 for the Application Form.
• Applicants who have submitted his/her application forms will be directed to any of the three receiving banks for pre-qualification.
• All applicants pre-qualified and recommended by any of the receiving banks will be issued with the Letter of Offer.
• Applicants are expected to pay the 30% equity contribution to any of the three collaborating banks.
• Applicants are to submit proof of payment and an acceptance letter to the Ministry of Housing.
• The Ministry of Housing refers documents to the Ministry of Justice to prepare and execute the Contract of Sales and Deed of Mortgage Agreements.
• The Ministry of Housing then releases the Letter of Confirmation of Allocation and keys to successful applicants.

Pre-Qualification/Screening Process

• Lagos State Government will first pre-qualify the intended beneficiary who must be a first time home owner in Lagos State and the claim of first time home ownership must be administered under an Oath.
• The pre-qualified individual must open an individual current account with any of the selected banks. The account will serve for both the purpose of paying 30% equity contribution and also for monthly repayment.
• The beneficiary will submit his\her allocation paper from Lagos State government to the bank along with a request letter and apply for a mortgage scheme under Lagos State Home Ownership Mortgage Scheme.
• Upon meeting the Risk Acceptance Criteria tabulated below, approval will be conveyed via an offer letter and monthly repayment schedule communicated to the beneficiary.
• For proof of affordability, salary earners are to submit pay slips for the past 6 months and salary account statement for the past one  year while self-employed would submit company profile, three years audited account statement and business or personal account statement for the past 12 months.
• Monthly repayment as stated in the repayment schedule commences as soon as offer is accepted and condition precedent to commencement of monthly repayment is met.
• The bank will communicate acceptance and approval to the Lagos State government for release of keys to the beneficiary to take possession.
• Update on monthly repayment will be given to the Lagos State government on monthly basis.
• A dedicated account will be opened which will warehouse all monthly payments from the buyers which would have joint signatories from the Ministry of Housing & Ministry of Finance.

Definition of Risk Acceptance Criteria: For the purpose of this term sheet, the table below spells out the risk acceptance criteria for effective administration of the scheme which will be adopted by the participating banks involved.

Risk Acceptance Criteria

The Lagos HOMS is a mortgage scheme that is completely funded by the Lagos State Government through the partnering banks.

Apart from providing the pool of Houses, Government also provides the funds for the mortgage facility being granted.

How Default Happens :

A person would have defaulted if he the beneficiary fails to pay for the home and defaults three times

A beneficiary is considered to have defaulted:

1. If the beneficiary fails to make repayments for three consecutive times.
2. If repayment has not been regular and there been defaults at three different times which in the opinion of the banker has raised doubt on the ability of the beneficiary to continue with the repayment, such issues will  be reported to LASG who will take steps towards foreclosure.

FORECLOSURE RIGHTS OF LAGOS STATE GOVERNMENT:

Foreclosure right is a legal right according to investopedia.com a legal process that allows lenders to recover the amount owed on a defaulted loan by taking ownership of and selling the mortgaged property.

The legal interest on these properties resides with the Lagos State Government, hence the legal and equitable right to foreclose lies with them. process of foreclosing a property of this nature starts when the beneficiary defaults to pay for three times consecutively. the banks are then forced to forward complaint to the homeowner, lagos state government, and the foreclosure is kickstarted.

Repayment Monitoring and Tracking

This shall be the joint responsibilities of LASG and Bank. Bank on a monthly basis will be updating LASG on the repayment update that shall aggressively follow up with any loan defaulters for regularization.

NOTICE BEFORE FORECLOSURE

A notice of foreclosure shall be sent to the beneficiary by the bank and a copy forwarded to Lagos state government, and This shall be allowed so far 90 days.

Available Properties Under This Scheme

1. Millennium Housing Scheme Iloro Agege – 3 Bedroom flats.
2. Oba Adeboruwa Estate Igbogbo Ikorodu – 1, 2 & 3 Bedroom flats.
3. Millennium Housing Scheme II Ojokoro Ijaiye – 3 Bedroom flats
4. Jubilee Housing Estate Odoragunshin Epe – Room & Parlour, 1 & 2 Bedroom Bungalows.
5. Oba Adeboruwa Estate Igbogbo Ikorodu – 1, 2 & 3 Bedroom  flats.
6. Lagos state Housing scheme Surulere

Source: Lagos State Government Website