ABSTRACT
These researches present an evaluation of problems and prospects of
mortgage banks. Federal mortgage banks are the case studies choose by
researcher on which the research is to be carryout. Mortgage bank are faced
with serious problems and these problems are growing at an alarming rate for
the purpose of this project critical analysis of these problem in needed and
likely solution to the problem should not be left untouched. This research work
will be basically treat this topic as related to the impact of mortgage bank in
housing delivery in Nigeria, also the remedies of the mortgage against mortgage
personally shall be mention in the research work. in this project it has been
present chapter by chapter.
TABLE OF CONTENTS
Title page i
Certification ii
Dedication iii
Acknowledgement iv
Abstract v
Table of content vi
CHAPTER ONE
1.0 Introduction 1
1.1 General
description of the study 1
- 3
1.2 Justification
of the study 3
1.3 Statement
of problem 3
1.4 Objective
of the study 3
1.5 Methodology
of the study 4
1.6 Limitation
of the study 4
1.7 Research
hypothesis 4
CHAPTER TWO
2.0 Literature review 5
2.1 Definition of the mortgage 5
2.2 Definition of immovable property 6 - 7
2.3 Classification of mortgage 7
- 8
2.4 Creation of mortgage 8
2.5 Right and sale without the intervention
of the court 9
2.6 Discharge of mortgage 9
2.7 Rights of a prior mortgage 10
- 11
2.8 Equitable mortgage and creation 11
- 12
2.9 Structure of Nigeria mortgage and creation 12 - 13
2.10 Problem of mortgage banks in Nigeria 13 - 14
2.11 Solution to the problems of mortgage 14
- 16
2.12 Solution to the problems of mortgage
banking in Nigeria 16
2.13 Mortgage as a security for bank
advances 16 -
17
CHAPTER THREE
3.0 Research methodology 18
3.1 Methodology employed 18
3.2 Assumption 18
- 19
3.3 Validity
19
- 21
CHAPTER FOUR
4.0 Data presentation and analysis 22
- 23
4.1 Remedies of the mortgage against the
mortgage personality 23- 24
CHAPTER FIVE
5.0 Summary, conclusion and recommendation 25
5.1 Summary 25
- 26
5.2 Conclusion 26
5.3 Recommendation 26
References 27
Questionnaire 28
CHAPTER ONE
1.0 INTRODUCTION
1.1 GENERAL DESCRIPTION OF
THE STUDY
Undoubtedly in a developing country like Nigeria, the desirability for
mortgage banking cannot be over stated housing is basic to means need and
survival, it is second only to food in the hierarchy of man’s needs. Not
surprisingly therefore, the government has made a cardinal objectives in its
social programmes.
Moreover, to facilitate the provision of shelter for all (perhaps before
the year 2000), the government promulgated the National Housing Fund (WHF)
decree No 3 of 1992. by the provision of
the decree on government is to make some unspecified contribution to the fund.
Employees are to part with 2.5% of their monthly income at a fixed interest
rate at 4% per annual. The bank and insurance companies are equally to invest
substantially into fund. Specially, the bank contribution to the fund stands at
10% of their loans and advances per annual at an interest rate of 1% above the
interest rate payable in current accounts.
Operationally, the Federal Mortgage Bank of Nigeria (FMB), the apex bank
for all mortgage institution is then expected to channel the fund back to the
contribution by the way of long terms loans through the mortgage institution
are allowed a maximum spread of 4% above banks borrowing rate.
On the whole, the decree is raised some fundamental issue which generated
reactions to mortgage institution in the country at such rate and upon such
terms as may be determined by the bard in accordance with the policy directed
by the Federal Executive Council being rates and terms, designed to grant comparative
facilities of Nigeria individual desiring to acquire houses of their own.
b.
The encouragement and promotion of the development of
mortgage institution at state and national levels.
c.
The supervision and control of activities of mortgages
institution in accordance with such directions may be given in that behalf by
the federal executive council.
d.
The provision of long term credit facilities directly
to Nigeria
individual at such terms as may be determined by the board in accordance with
the policy directed by the executive council.
e.
The provision with the approval of the commissioner at
competitive commercial rates of interest, of credit facilities to commercial
property developers, Estates Developers and other specialized types of building.
f.
Acceptance of term deposits and saving from mortgage
institution, trust the post office and private individual as the board may determine.
g.
The promotion of mobilization of saving from the public.
From the participants and members of public for instance it is argued that
the mandatory contribution by the working populace is unrealistic vis-à-vis the
low and fixed interest rate it attracts against the prevailing market rates.
Besides, the various huddles to scale through by contribution before they
can benefit from the fund have also become a source of concern. It is argued
that the mortgage institutions on whose shoulders rest the onus of fund
disbursement to prospective beneficiaries would definitely prescribed some
requirement that might include compulsory saving with the occupancy and
approved building plans, contribution of 25% of the total loans required for building or purchasing of
house.
However, as lofty and laudable as the national housing fund decree is, it
still required some fine turning in order to meet the yearning of all
participant. Therefore, government should bank 5% of their total annual credit
portfolio to the National Housing Fund (NHF).
Meanwhile, the mortgage institution, which came into being in December
1996 after many year of research and planning has the following aims and
objectives in the light of the foregoing, decree 70f 20 1997 spent it out the
objectives of federal mortgage bank of Nigeria which are the following:
a.
The provision of long term credit facilities
b.
The investment of money in companies engaged in the
manufacture or production of building materials in the country with a view to
establishing the cast of such materials.
c.
To carry out research aimed at improving housing patterns
and standards both in urban and rural areas and monitor the mortgage finance
activities ad building contraction industry in Nigeria.
d.
Finally, to combine with reputable insurance companies
to organize a mortgage protection system designed to guarantee liquidity to
mortgage as well as well afford them the opportunity to have liberal premium /
promise.
The promulgation of the decree 7 of 20th January 1977, dissolved the NBS
and established the federal mortgage bank (FMN). The (FMBN), took over the
assets and liabilities of NBS at establishment. FMBN had an authorized capital
of 20 million divided into 200,000 shares at #100 each.
In June 1979 an unprecedented influx of mortgage applicant was recorded
resulting from the fair policies of the bank vis-à-vis other private mortgage
institution. It is pertinent to mention that the injection of #90 millions was
a more conversion of the bank debts to the federal government to equity. Such
increase in net worth does not in way increase the available loan able fund to
the numerous mortgage applicants. However, the central bank did provide an additional
loan able fund of #60 million. In effect FMBN is owned by the federal
government and the CBN diligent mortgage accounts.
The federal government attaches important to housing as one of the basic
necessities of human beings because of its profound effect on health, welfare
and productivity of the individual. The shortage of accommodation in the major cities
as per survey by federal office of the statistics was an indication of the
inability of the Nigeria
building society to scope with the demand for shelter.
1.2 JUSTIFICATION
OF THE STUDY
This study is very essential in that help to have broad knowledge of what
a mortgage is all about.
Moreover, the study enable for familiarizes us with some terms used in
mortgage institution and their definitions.
Conclusively the various problems and prospects of mortgage institution
are also know through this research work.
1.3 STATEMENT
OF THE STUDY
This research work will basically treat in this topic as related to the
impact of mortgage bank. furthermore, those impact of the mortgage institution
when granting loan to people purpose will be treated in this research work.
In addition, the remedies of the mortgage against mortgage personally
shall be mention in this research work.
1.4 OBJECTIVES
OF THE STUDY
The objectives of this study is to evaluate the prospects and challenges of
mortgage institution in Nigeria.
1.5 METHODOLOGY
OF THE STUDY
For the purpose of this research work, I have to adopt method was used is
the method personal; interviews.
Due to lack of sufficient time and to avoid untold hardship that may
attend the gathering of accurate information, I decided in this research work
to choose federal Mortgage Bank as my case study.
In the process of collecting relevant information I adopted the personal
interview method as my primary source of information and it gives an
opportunity of having brief discussion with some customers on the process and
purpose of THE EVALUATION OF PROBLEMS AND PROSPECTS OF MORTGAGE BANKING IN
NIGERIA.
Also, the researcher made use of the bank’s annual report and journals
for some other information, which could not be obtained through the personal
interview.
1.6 LIMITATION
OF THE STUDY
This research work has suffered some set back by ways of having assessed
to some vital information and documents. This was as a result of the fact that
banks operate in a very strict and confidential environment most of their
documents and information can not be deliberate given to an outsider without
some restriction.
However, some of the information concerning the and are unrevealed as a
result of the anxiety created by the bank.
Also, on the course of the research work, this is financial problem
before the complexion of this research work.
In addition, the researcher has to travel to the headquarter of the bank
to ask for permission and clearance before getting the information needed from
the branch from the branch chosen as a
case study.
1.7 RESEARCH
HYPOTHESIS
Hypothesis I
Ho: Mortgage
operation is significant to low level profit.
Hi: Mortgage
banking is significant to urban development
Hypothesis II
Ho: Mortgage
operation is significant to low level profit.
Hi: Mortgage
banking operation is not significant to low level
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