Africa has been a cash based society for centuries. People have bought land and built homes all based on the money they had available to them. In Ghana people can buy land and build homes in small increments over long periods of time based on the money they have available to use on the build. Recently, a new system has been brought in from the west. That system is called mortgages. Being that this is completely foreingn in Ghana the same systems are being used in Africa that are used in Britain and the United States to verify and rank credit worthiness of a mortgage. Here are five things you need to know about mortgages in Ghana.

  1. Interest rates – banks in Ghana have home mortgage loans with interest rates starting at 22% and going as high as 30%. Which is astronomical in any part of the world.
  2. Banks offer both fixed rate and adjustable rate mortgages in an attempt to attract more clients to utilize this new form of home ownership. However, when dealing with flauction of interest rates it can lead to perpetual debt and inability to pay the mortgage off.
  3. Is the developer you are buying the home from requiring a mortgage be acquired with a particular bank in order to purchase from them? This can become problematic if you do not want to be penguin holed into terms that can adversely affect your budget.
  4. Who really owns the land the home sits on? Is the title owned by the developer, or an unknown entity or will the land title be owned by the bank until you pay off the mortgage.
  5.  If you take a mortgage to build with a developer are you allowed to modify and change the house plan once construction starts? Will this change the terms of the mortgage interest rate, term length or nullify the contract? 

These are all things you should know before taking out a mortgage in Ghana. Mortgages in Africa are a different type of beast and should be thoroughly thought out and due diligence put in before venturing into. BlackUnicorn Properties can build your house for you without a mortgage and over time. As we work with our clients budget and building plan expectations. Reach out to us for more information.

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