Steps When Applying for a Mortgage

how quickly can a mortgage be approved?

Over the past few months, there has been an increase in the number of people looking for bungalows and maisonettes compared to the ones who want apartments. There has also been an increase in people looking for land. Depending on which property type you want, getting a mortgage will help you achieve your dreams of owning a home.

The mortgage process doesn’t have to be a confusing one. Luckily, we have Head of Business Development, Property Finance at NCBA, Stella Mutai to break down the mortgage application process. Read on.

We know that Home Ownership is a scary journey, especially for first-time homeowners. Many people don’t know where to start. There are so many fears about falling prey to dubious deals. Is this house fully approved, will I start making payments then I realize it’s not legal? Coupled with that, the whole concept of a mortgage is not understood by many, it’s shrouded in mystery.

That is why we shared a beginner’s guide to mortgages and we are now breaking down the different stages related to the mortgage process. Keep in mind that the process will vary from one mortgage lender to another. However, below are the basic steps. (This is the process when you visit NCBA)

What steps are involved in the assessment of my loan?

The mortgage loan process involves internal and external stages.

Stage 1 – When we receive complete documentation, we advise on the decision of your loan application within 48 hours. Borrowings for complete or off-plan properties will be based on the selling price or current open market value, whichever is lower. Equity release borrowings (borrowing against already-owned properties) will be based on the current market valuation report.

Stage 2 – We send you a letter of offer for your review and acceptance. We require you to sign it and return to us within the time specified in the offer letter. If you are in the diaspora, you can scan the same to us for our acknowledgement while you courier the hard copies to us.

Stage 3 – We will arrange for a valuation to be carried out on the property being offered as security by credible Valuers who are listed on the bank’s panel. Valuation fees are applicable and payable by you upon completion of the exercise.

Stage 4 – Security perfection – A Lawyer (in the Bank’s panel) will prepare the charge documents and present the Title document to the Government for registration. For mortgage transfers, the Bank appointed lawyers will communicate with the relevant financier where your mortgage is currently being serviced, to release the Title for registration and present the same for registration.

Stage 5 – Once we receive the duly registered property documents and legal charge, we release funds (make the disbursement) as specified in the offer letter.

Stage 6 – You will then receive a notification of the disbursement and the mortgage repayment details.

How long does the whole mortgage finance process take?

It takes approximately 90 days to complete the entire process for a purchase or a mortgage balance transfer to NCBA and approximately 45 to 60 days for an Equity release facility. This is assuming there are no inordinate delays with any of the third-party processes (valuation and/or with the Government Registry).

Do you have more questions related to the mortgage stages? Feel free to reach out below.

Maureen Mbithe
Content Writer at BuyRentKenya
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