There are several ways to finance the purchase of a property in Nairobi.
Mortgage loans
The most common way to finance a home purchase is by getting a mortgage loan. You borrow
money from a lender and pay it back over time with interest. Most of these loans come with
appraisal fees of 2.5% of the loan amount. Additionally, there may be other included fees such
as Ledger fees, Legal fees, Stamp Duty( 0.1% of the loan amount), Valuation fees, and Insurance
to cover life and property.
Cash
If you have enough savings, you can pay for the property in cash. Cash payments in real estate
are speedy and convenient and more quickly and with less paperwork. They also have great
negotiating power whereas a buyer may have an advantage when negotiating the purchase
price. Furthermore, by paying in cash, you can avoid other costs associated with obtaining a
loan, such as appraisal fees and loan origination fees.
Owner financing
In some cases, the seller may be willing to finance the purchase themselves. Owner financing in
real estate refers to a situation where the seller of a property provides financing for the buyer
instead of the buyer obtaining financing from a bank or other lender. A great example is a
contract for Deed or Land Contract.
In this arrangement, the seller retains ownership of the property until the buyer has completed
all payments. The buyer makes regular payments to the seller, and once all payments are made,
the seller transfers ownership to the buyer. It’s important to note that owner financing can be a
complex process, and buyers and sellers should consult with professionals such as real estate
agents, attorneys, and financial advisors before entering into any agreement.
If you are looking to own real estate property and would like a step-by-step guideline, we are
here for you. Reach out to us today.
