Residential mortgages are one of most common forms of credit. The average home in Ghana now costs around $116,000, so it’s highly likely that you will need to take out a mortgage to afford to purchase your own property. Whether you’re a first-time buyer or looking to move house, a residential mortgage is the type of mortgage you will need to take out.
A residential mortgage is a mortgage for a house that you live in. It is a long term loan which helps to fund the purchase of a property. The mortgage is to be paid back over approximately 30 years. With this type of mortgage, you must be living in the home yourself. You cannot rent the house out to tenants or use the property for any commercial purpose.
How it works
Residential mortgages typically require a cash deposit of between 10 and 30% of the total property value. For example, the deposit you would require for a $200,000 home would be somewhere within the region of $20,000 and $60,000. Note: This deposit required for a mortgage is NOT an amount you will pay us (or any mortgage lender) upfront when you apply. This deposit is what you will need to actually pay directly to the property vendor and we pay the rest to the property vendor.
Every mortgage has an LTV (Loan-to-Value) ratio. This is the amount you borrow set against the total value of the property. So for example, If you are looking at buying a house with a value of $200,000 and you have a deposit of $40,000, then you will need to borrow $160,000 to afford the property. This would give you an 80% LTV mortgage with your deposit making up the remaining 20%.
The lower the ratio, the lower the risk to the lender and the better the interest rate you will be eligible for.
Features
• Maximum LTV: 95% (meaning you need to come up with 5% of the property price yourself). However, 100% mortgages available, subject to household income, repayable years left before pension at 60 years.
• Maximum Lending Rates: 12.00 % p.a. (incl Cedi mortgages)
• Borrowing currencies: Ghana Cedis for all Ghana-based Ghana Cedi income earners. All foreign currency home loans are provided by DCANS Mortgage UK (a sister company)
Eligibility Requirements
To qualify for an owner-occupier home mortgage with us, your net monthly salary (or total household income including that of your spouse, children, etc) as a SSNIT-registered Public or Private Sector Employee is above GHS2,000. Learn more.
Differences between Repayment Mortgage and Interest-Only Mortgage
With an interest only mortgage you:
• only pay back the interest
• pay the rest of what you borrowed at the end of the mortgage term
At DCANS Mortgage, we have structured Pension Mortgage as a special interest-only to allow for minimal monthly repayments and the opportunity to boost household income before mortgage term expiration at pension to accommodate any repayment vehicle (Tier-2/3 Pension) shortfall.
With a repayment mortgage you:
• pay part of the loan and the interest back each month
• will have paid everything back at the end of the term if you’ve made all your payments
So if you borrowed GHS150,000, over 25 years at an interest rate of 4% you’d pay: GHS500 a month with an interest only GHS791 a month with a repayment mortgage With interest only, you’d still owe the GHS150,000 at the end of the mortgage term.
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