Bank Loans for Plot Purchase and Building – How to Buy a Small piece of Land
While owning a home is a person’s dream, not everyone has the immediate finances for bringing this dream into a reality. Money discipline plays a big role when it comes to investing in the Real Estate sector. Some people can finance themselves using their personal savings while others, bank loans come in handy.
Today we get to talk about bank loans and preferably NCBA.
Who is NCBA?
NCBA is a Kenyan based company that provides banking, financial and related services. It is licensed by the Central Bank of Kenya and National Banking Regulator.
They offer a wide variety of loans that cater for individual client needs. If you are looking for financing then NCBA has just the right construction loan for you.
Understanding the term Buy and Build:
This is a product that enables customers to buy land sand construct a home simultaneously. A customer can purchase a piece of land and undertake construction on the same piece of land both within the same facility.
The following structures will help you understand better what is required for you to know when applying for the loan:
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Areas the facility finances
NCBA finances Nairobi, Mombasa and all the major urban towns in the country. It is always good to know which places are financed so as to know whether you property is eligible. This will save you from the hustle of applying for the loan and the bank rejecting your offer.
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Minimum plot size it finances
The minimum plot size NCBA finances are a 40ft by 80ft plot. Lower than this, your plot will not be able to be granted any offers.
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Maximum financing available for its customers
NCBA offers 100% financing on both combined plots and construction costs. Talk to the bank agents and get to understand what their terms are and what percentages they offer. This varies from bank to bank.
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Collateral replacement indemnity
Collateral is something pledged as security for repayment of a loan, to be forfeited in the event of a default. It is an insurance product that enables the bank to 100% finance the homeowner.
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Any loan limits
The maximum loan limit NCBA offers is 20M. Again, this varies from bank to bank. Make sure your project can be financed by the bank to avoid disagreements.
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Key construction documents
These documents will assist you during the loan application process. Make sure the documents are in order and up to date.
They are;
- Copy of the Title Deed
- Architectural drawings
- Structural drawings
- Bills of quantities
- Architects & QS’ BORAQS practicing certificates
- Structural Engineers EBK practicing license
For more information on the documents, the bank agent is always ready to explain further on their importance.
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Panel of contractors
NCBA usually has its panel of contractors who are willing to work with the customer. The bank only offers the below contractor;
- Quantity Surveyor
Always remember to engage qualified and professionals who are registered with their respective boards. It will save you the hustle of dealing with quarks. Some of the contractors you will need are;
- Architects
- Engineers
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Do you really need a contractor
The answer to this question is NO. You need contractors to help you in your building. Each has specialized in their individual field hence they all come in handy.
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Construction grace period
NCBA offers 9 months grace period.
With that said, it is good to be armed with knowledge before applying for a loan. Get to understand your preferred bank, the requirements needed and all the facts that come with it.
Denver Group Limited is among the best land agents in Kenya. We deliver on our promise and ensure that we sell land that has ready Title Deeds. To buy a plot from us or to book a free site visit, Call/WhatsApp us: 0701 730 267, 0702 202 888.
