Surveyors Urge Funds Transfer To Mortgage Bank

The Nigerian Institution of Estate Surveyors and Valuers, (NIESV) has said that idle funds that are meant for development, such as the National Housing Fund (NHF) and the Pension Funds which are kept in commercial banks, are not supposed to be kept there, but should be transferred to the Federal Mortgage Bank of Nigeria (FMBN) for quicker property development.

Speaking in a chat with The Tide in Port Harcourt, the Chairman of NIESV, Rivers State branch, Emma Wike said that funds being generated through the NHF and Pension funds should not be kept in the commerials banks.

He said that such funds were supposed to be in the custody of the FMBM which will give them out to other primary mortgage institutions that depend on FMBN for funds to finance or fund projects.

Wike described the FMBN as the apex mortgage Bank in Nigeria and the primary source of funds for mortgage financing, while other private mortgage institutions PMLs serve as secondary source of mortgage funds.

The Rivers State NIESV boss also explained that his observation showed that the apex mortgage institution which is the primary source of funds for mortgage is not working, and that is the reason why other secondary sources of mortgage funds are having problems.

He said “rather than get funds from the FMBN for development, the PMIs which are the secondary sources of mortgage funds now go to the commercial banks for funds, which is very expensive with high interest rate”

The Chairman compared the interaction between the FMBN and other PMIs to that of the Central Bank of Nigeria and the commercial banks, pointing out that the difference between the PMIs and commercial banks is the rate of interest and the period of repayment.

According to him, the commercial banks charge high interest and with short period of repayment, whereas the mortgage period can last longer (between 10-15 years) while the interest is low.

He therefore called on the relevant authorities to ensure that these idle funds were put to use at the FMBN, so as to guarantee availability of mortgage funds for projects development.

Corlins Walter