Authored by the expert who managed and guided the team behind the Nigeria Property Pack
Everything you need to know before buying real estate is included in our Nigeria Property Pack
Nigerian banks typically require a minimum deposit of 10% for mortgages, though this can range up to 30% depending on the lender and property type.
Federal government schemes like the National Housing Fund offer more accessible options with 10% deposits for eligible salary earners, while private banks maintain stricter requirements that vary based on income levels and property classification.
If you want to go deeper, you can check our pack of documents related to the real estate market in Nigeria, based on reliable facts and data, not opinions or rumors.
Nigerian mortgage deposits typically range from 10% to 30% of property value, with federal schemes offering the most accessible 10% option for salary earners.
Total upfront costs including fees usually amount to 17-22% of the property purchase price.
| Scheme Type | Minimum Deposit | Total Upfront Cost | Best For |
|---|---|---|---|
| National Housing Fund (NHF) | 10% | 17-20% | Salary earners, first-time buyers |
| Private Banks | 10-30% | 17-42% | Higher income earners |
| Federal Mortgage Schemes | 10% | 17-20% | Low to middle income buyers |
| Commercial Banks (Standard) | 15-20% | 22-32% | General residential buyers |
| Investment Properties | 20-30% | 27-42% | Buy-to-let investors |
How much do Nigerian banks usually require as a minimum deposit for a mortgage?
Nigerian banks typically require a minimum deposit of 10% for residential mortgages as of September 2025.
Most commercial banks including First Bank, Zenith Bank, and GTB maintain this 10% baseline for standard residential properties, though some institutions may demand up to 30% depending on the applicant's income profile and creditworthiness.
The 10% minimum applies specifically to owner-occupied residential properties, while investment properties and commercial real estate often face higher deposit requirements ranging from 20% to 30%. Banks assess each application individually, considering factors like employment status, monthly income, and existing debt obligations when determining the exact deposit percentage.
It's something we develop in our Nigeria property pack.
Does the Central Bank of Nigeria set any official guidelines on mortgage deposit percentages?
The Central Bank of Nigeria establishes broad regulatory frameworks for mortgage lending but does not mandate specific deposit percentages for all mortgage transactions.
CBN guidelines focus primarily on loan-to-value ratios, risk management protocols, and capital adequacy requirements for financial institutions rather than dictating uniform deposit amounts. The central bank allows individual banks to set their own deposit requirements within established prudential guidelines.
However, CBN does influence deposit requirements indirectly through its supervision of mortgage institutions and its involvement in federal housing schemes like the National Housing Fund, where it helps establish more standardized terms for government-backed mortgages.
What is the standard deposit percentage for first-time home buyers in Nigeria?
First-time home buyers in Nigeria typically face the same 10% minimum deposit requirement as other residential mortgage applicants.
Unlike some international markets that offer special first-time buyer programs with reduced deposits, Nigerian banks generally apply standard deposit percentages regardless of whether it's a buyer's first property purchase. However, first-time buyers can access more favorable terms through federal schemes.
The National Housing Fund specifically targets first-time and low-income buyers, maintaining the 10% deposit requirement while offering lower interest rates and more flexible repayment terms compared to traditional commercial mortgages.
Do deposit requirements change depending on whether the property is residential, commercial, or buy-to-let?
| Property Type | Typical Deposit Range | Risk Assessment |
|---|---|---|
| Owner-occupied Residential | 10-15% | Lowest risk category |
| Buy-to-let Residential | 20-25% | Medium risk - rental income dependency |
| Commercial Office | 25-30% | Higher risk - market volatility |
| Commercial Retail | 25-35% | Higher risk - sector challenges |
| Mixed-use Development | 20-30% | Variable risk - complexity factors |
| Industrial Property | 30-40% | Highest risk - specialized market |
How do deposit rules differ between federal government housing schemes like NMRC or FMBN and private bank mortgages?
Federal government housing schemes consistently offer 10% deposit requirements compared to private banks' 10-30% range.
The Federal Mortgage Bank of Nigeria (FMBN) through its National Housing Fund maintains standardized 10% deposits for all eligible participants, regardless of income level or property location. The Nigeria Mortgage Refinance Company (NMRC) works with participating banks to ensure similar accessibility.
Private banks operate with more flexibility, often requiring higher deposits from applicants they perceive as higher risk, while federal schemes prioritize housing accessibility over profit margins. Federal programs also offer longer repayment periods and lower interest rates, making the total financing package more affordable despite similar deposit requirements.
Government schemes typically process applications through dedicated channels with specific eligibility criteria, while private banks maintain broader application processes but with more stringent financial assessments.
Don't lose money on your property in Nigeria
100% of people who have lost money there have spent less than 1 hour researching the market. We have reviewed everything there is to know. Grab our guide now.
What is the lowest deposit option currently available under the National Housing Fund scheme?
The National Housing Fund scheme offers its lowest deposit option at exactly 10% of the property purchase price.
This 10% deposit represents the minimum requirement for all NHF participants, regardless of income level or property location within Nigeria. The scheme provides up to 90% loan-to-value financing, making it the most accessible mortgage option currently available in the Nigerian market.
NHF participants must contribute 2.5% of their monthly income to the fund for at least six months before becoming eligible for mortgage financing. The scheme covers properties valued up to ₦15 million in any location across Nigeria, with loan terms extending up to 30 years.
Unlike private bank mortgages that may reduce deposit requirements through negotiation or special programs, NHF maintains its 10% standard across all applications, ensuring consistent accessibility for eligible salary earners.
Do higher-income earners in Nigeria face the same deposit percentages as middle- or low-income earners?
Higher-income earners generally face the same base deposit percentages but may access more favorable terms through private banking relationships.
Standard deposit requirements of 10-30% apply across income brackets, though higher-income applicants often qualify for the lower end of this range due to reduced perceived risk. Private banks may offer premium banking clients deposit reductions or additional financing options not available to standard applicants.
Low-income earners benefit specifically from federal schemes like NHF, which maintain the 10% deposit regardless of income level, while middle and high-income earners typically navigate private bank requirements that vary based on individual financial profiles.
Banks assess higher-income applicants' overall wealth, not just salary, potentially leading to more flexible terms or access to jumbo mortgage products with different deposit structures for properties exceeding standard value thresholds.
How does the length of the mortgage term affect the required deposit?
Mortgage term length typically does not directly affect deposit percentage requirements in Nigeria.
Whether applicants choose 10-year or 30-year mortgage terms, banks maintain consistent deposit requirements based on property type and borrower risk assessment rather than loan duration. A 10% deposit applies equally to short-term and long-term mortgages for residential properties.
However, longer mortgage terms may influence overall loan approval decisions and interest rate calculations, which could indirectly affect banks' willingness to accept minimum deposits. Banks may view longer-term commitments as higher risk due to economic uncertainty, potentially leading to stricter financial assessments rather than increased deposit demands.
It's something we develop in our Nigeria property pack.
We did some research and made this infographic to help you quickly compare rental yields of the major cities in Nigeria versus those in neighboring countries. It provides a clear view of how this country positions itself as a real estate investment destination, which might interest you if you're planning to invest there.
Can salary earners with proof of steady income negotiate a lower deposit requirement with Nigerian banks?
Salary earners with documented steady income can sometimes negotiate reduced deposits, particularly with banks where they maintain existing relationships.
Banks may consider employment history, salary account relationships, and overall banking relationship when evaluating deposit flexibility. Long-term customers with strong payment histories and substantial account balances often receive more favorable consideration for reduced deposit requirements.
However, most Nigerian banks rarely go below the 10% benchmark without additional collateral or guarantees, even for their most creditworthy salary-earning customers. The negotiation typically involves interest rates, processing fees, or repayment terms rather than significant deposit reductions.
Federal government employees and workers at established corporations often have more negotiating power due to perceived job security, while private sector employees may need to provide additional documentation or guarantees to access similar flexibility.
What additional upfront costs besides the deposit should be budgeted for in Nigeria?
1. **Legal fees and documentation**: Typically 5-10% of property value for title verification, contract preparation, and legal representation 2. **Property valuation fees**: Usually 0.5-1% of property value, required by all mortgage lenders 3. **Property insurance premiums**: Mandatory mortgage protection insurance, varying by bank and property value 4. **Bank administrative fees**: Processing charges ranging from 0.5-1.5% of the total loan amount 5. **Survey and inspection costs**: Professional property surveys and structural inspections 6. **Stamp duty and registration**: Government charges varying by state and property value 7. **Agency commissions**: Real estate agent fees if using property intermediariesAre there any regional differences in deposit requirements between Lagos, Abuja, and other states?
Core deposit requirements remain consistent across Lagos, Abuja, and other Nigerian states, with banks applying similar 10-30% standards nationwide.
However, total upfront costs vary significantly between regions due to differences in legal fees, property registration charges, and administrative costs. Lagos properties often involve higher professional service fees due to market sophistication and property values.
Abuja's status as the federal capital sometimes results in more streamlined federal scheme access, while smaller states may have limited mortgage product availability from major banks. Regional banks in specific states might offer localized programs with different terms, though these typically maintain similar deposit requirements.
Property values themselves create the most significant regional impact, with higher-priced Lagos and Abuja markets requiring larger absolute deposit amounts even at the same percentage rates.
What is the typical total cash a buyer needs ready in Nigeria today before a bank will approve the mortgage?
Nigerian property buyers should prepare 17-22% of the property purchase price as total upfront cash for mortgage approval.
This includes the 10% minimum deposit plus additional costs of 7-12% covering legal fees, valuation, insurance, and administrative charges. Federal scheme participants often stay closer to the 17% total, while private bank mortgage applicants may need up to 22% or more.
For a ₦20 million property, buyers should have ₦3.4-4.4 million readily available, while a ₦50 million property would require ₦8.5-11 million in upfront cash. These amounts must be available in cash or immediately accessible funds before beginning the mortgage application process.
Banks verify fund availability early in the application process, making it essential to have complete upfront amounts confirmed before property selection and offer submission.
It's something we develop in our Nigeria property pack.
Conclusion
This article is for informational purposes only and should not be considered financial advice. Readers are advised to consult with a qualified professional before making any investment decisions. We do not assume any liability for actions taken based on the information provided.
Nigerian mortgage deposits have remained relatively stable at 10% minimum through federal schemes, making property ownership accessible for salary earners willing to participate in government programs.
The key to successful property financing in Nigeria lies in understanding the total upfront cost structure and choosing between federal schemes offering consistency versus private banks providing potential flexibility for higher-income applicants.
Sources
- Vala Homes - Buying a House with a Mortgage in Nigeria: The 2025 Update
- Trusted Advisors Law - CBN Guidelines for Mortgage Refinance Companies
- Central Bank of Nigeria - Revised Guidelines for Primary Mortgage Banks
- Federal Mortgage Bank of Nigeria - National Housing Fund
- AG Mortgage Bank - Mortgage Products
- PropertyPro - Owning a Home in Nigeria Through Mortgage
- NALTF - Federal Government Single Digit Mortgage Loans
- First Bank Nigeria - Personal Home Loans