The Housing Development Advocacy Network (HDAN) yesterday proposed the establishment of a national mortgage guarantee and inclusion framework that would bring together the Federal Mortgage Bank of Nigeria (FMBN), Nigerian Mortgage Refinance Company (NMRC), Ministry of Finance Incorporated Real Estate Investment Fund (MREIF), and Family Homes Fund Limited (FHFL).
The group said the framework should also include commercial banks, primary mortgage banks and other stakeholders to expand access to affordable housing finance in the country.

The advocacy group made the call in a new report by its Research and Economic Development Unit, stressing that Nigeria needs a coordinated mortgage system capable of serving not only salaried workers but also traders, artisans, farmers, entrepreneurs and other Nigerians earning legitimate but irregular incomes.
HDAN explained that Nigeria already has several institutions and interventions capable of supporting a stronger mortgage market, but they need to be better coordinated around long-term funding, risk sharing, affordable housing supply and financial inclusion.

 It said: “Nigeria does not necessarily need to keep creating new housing-finance institutions. We need to connect the institutions and interventions we already have and make them work together at scale. ”
 The Network pointed out that the FMBN, NMRC, MREIF, FHFL and the banking sector could play complementary roles under a national framework rather than operating largely through separate interventions.

It therefore proposed that a mortgage guarantee mechanism should form a major component of the framework, allowing government-backed institutions to share an agreed portion of the risk on qualifying mortgages.
 The group further said this could encourage banks and mortgage institutions to deploy more private capital into housing, particularly for Nigerians who can demonstrate repayment capacity but fail to meet conventional mortgage requirements.

 According to HDAN, government cannot provide all the money required to finance homeownership for millions of Nigerians but government intervention should be used strategically to reduce risk and attract substantially greater private-sector capital into housing finance.
HDAN stressed that mortgage guarantees should not encourage reckless lending, adding that the system must have clear eligibility requirements, proper underwriting standards, transparent risk-sharing arrangements, monitoring and consumer protection.

The organisation said Nigeria’s large informal economy makes mortgage inclusion particularly important and argued that the absence of a monthly salary should not automatically be treated as evidence that a prospective borrower lacks the capacity to repay a mortgage.
 It called for alternative mortgage underwriting systems that could consider verified bank transactions, rent-payment history, cooperative contributions, business turnover, digital transactions, tax records and other credible evidence of income.

It stressed that mortgage inclusion should not mean weakening lending standards but finding more reliable ways of identifying creditworthy Nigerians outside the traditional salary system.
 The group said under the proposed framework, the FMBN could deepen affordable mortgage products, National Housing Fund participation, cooperative housing and rent-to-own programmes.

“NMRC could strengthen mortgage refinancing, underwriting standards, standardisation and access to long-term capital-market liquidity, while MREIF could help mobilise patient, long-term capital for housing finance. FHFL could contribute its affordable housing development and delivery experience, while commercial banks and primary mortgage banks could originate and service qualifying mortgages using their capital, technology, customer bases and distribution networks.
“FMBN brings affordable mortgage infrastructure. NMRC brings refinancing and standardisation. MREIF brings long-term investment capital. FHFL brings affordable housing delivery experience. Banks bring capital, customers, technology and distribution. Nigeria needs a framework capable of bringing these strengths together,” HDAN said.

HDAN, however, cautioned that expanding mortgages alone would not resolve Nigeria’s housing affordability challenge if available houses remain beyond the incomes of most households.
It said mortgage reforms should therefore be accompanied by interventions addressing land costs, infrastructure, construction finance, building materials, development approvals, property documentation and other factors affecting housing prices.

“There is little benefit in giving a household access to mortgage finance if the cheapest suitable house available is still beyond what that household can afford. Mortgage reform and affordable housing supply must move together,” it stated.
The organisation also called for greater mobilisation of long-term capital through refinancing, capital-market instruments, development-finance institutions and appropriately regulated institutional investment.