Former President of Nigerian Bar Association, NBA, Dr. Olisa Agbakoba, SAN, has called for a law that will enable people at the grassroots have access to mortgage facility.

Speaking with journalists at the 2014 Legal Business Summit in Lagos, titled “Waking Up Dead Capital,” he said it was part of government’s political responsibility to stand as guarantor for people to take mortgage, knowing that they will not default.

According to him: “Study has shown that Nigeria’s wealth is in the ground but we use machines to bring up the crude. So, Nigeria’s housing wealth is in the ground. We need laws to escalate it and distribute to Nigerians at an affordable interest rates. One way that a government that need your vote can assure you housing if you vote for them is to assume responsibility for a debt to enable people take mortgage, knowing that the people will not default since most do not default in paying rent. So, it is part of government’s responsibility, it is part of their political responsibility. I want to hear what the Peoples Democratic Party, PDP will be saying. I want to hear what the All Progressive Congress, APC will be saying in 2015 about how they intend to unlock dead capital.”

One of the discussants, Mr. Osaro Egbobamien, SAN, on his part, noted that the legal framework that would encourage banks to give people mortgage was not efficient, saying “There appears to be gross confusion as to what the Nigerian Mortgage Refinance Company (NMRC) is expected to do. The NMRC is a secondary mortgage liquidity facility. What that means is they lend to primary mortgage institutions who then lend unto the borrower. They do not and they will not interact with borrowers on the street.

“And the reason that was introduced was because the institutions that lend from mortgages do not have long time capital and we are talking about borrowing that will last between 20 and 25 years. What we want to achieve is that if you are paying rent at any point, that property must be yours.

“Once the under writing standards are well understood and the micro-policy is attended to, why should you pay rent for a period of 20 to 40 years and you cannot convert it into ownership,” he stated.

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