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24.01.2008 Business & Finance

Good News For Public Servants•Mortgage Loans Ready

By Daily Guide
Good News For Public ServantsMortgage Loans Ready
24.01.2008 LISTEN

Government has made funds in the form of mortgage loans available for public sector employees to enable them purchase their own houses.

The initiative dubbed, “Public Sector Housing Finance Scheme”, is part of government's affordable home ownership drive for workers in the public sector.

Already, government has in this regard, signed an agreement with HFC Bank, the financial institution that will undertake this programme.

Charles Martinson, General Manager in charge of Business Development of HFC Bank disclosed this to CITY &BUSINESS GUIDE.

He said government in its 2007 budget, mandated HFC Bank to provide affordable home ownership scheme for public sector employees, thus “we presented a proposal in that direction which was accepted”.

Under the scheme, the maximum loan accessible shall not be more than GH¢25,000 and beneficiaries could be offered up to 100 percent loan subject to their ability to pay. The repayment period is 20 years or up to the beneficiary's retiring age.

He said the scheme was a move by the two parties to make public sector employees own houses sooner than they envisaged because “under this scheme, employees within that sector can access relatively cheaper mortgage loans to buy their own houses.

“For an employee to access the facility, he or she must have been working in the public sector for a minimum of five years. The applicant must not have reached the general mandatory retiring age of 60 or 65 in the case of Judges of the High Court and 70 years in the Appeals and Supreme Courts,” he added.

He stated that for applicants who have 5 years or less, to retirement, the bank will lend to them provided government agrees to pay the outstanding loan amount due, out of the borrowers' total lump sum entitlements when he or she is about to go on pension or when the loan matures.

The bank may also lend at commercial rates on amounts greater than the maximum loan but beneficiaries will be expected to make up the differences as a condition for the disbursement of the loan.

Properties which qualify under the scheme, include all the 10,000 housing units being built for public servants by the Ministry of Water Resources, Works and Housing, whilst other eligible properties must have basic infrastructure including access to roads, water, electricity and drainage.
By Patrick Ampong-Baidoo

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