Are you looking forward to buying or renovating a property? And bank financing, via a home loan , is often the best way to achieve your goal. Thankfully, financial institutions across the island offer an array of customised funding solutions . Let us get into it with the help of our partners.
Everything you need to know about home loans…
Acquiring a loan can be a difficult path for some. It is therefore important to fully understand the process, the criteria, how to plan your budget effectively, the debt ratio, and of course, the disposable income (the household income after the deduction of fixed charges).
To help you better understand the market, the profile of the borrowers and the options available, 3 questions were asked to out partners:
1. What characterises the Mauritian / foreign borrowers (age, couples, retirees, first-time buyers, etc.)?
2. Why do they take out a home loan and for what types of housing (construction, extension, renovation, investment, apartments, houses, etc.)?
3. What are your terms for a loan (guarantees, salary, rates, etc.) ?
HERE IS THEIR TAKE ON IT>>
Abraham Rawat - Head of Retail, MCB
“70% of our clients are joint borrowers and the majority of them are between 30 and 40 years old (36%). Also, 15% of them have additional assets today. They perceive ownership of a property as a good investment for the future, as well as being an additional source of income. They moreover plan to hand over their assets to the next generation.
Our study indicates that 51% of Mauritians are eager to become homeowners. Housing loans are used mainly to build new homes because the demand converges more towards the purchase of land, the acquisition of a house or the construction of a house.
All customers needing help can approach the MCB for a loan application and we try to adapt our solutions accordingly to each project. The criteria on which we rely on, among other things, to evaluate a home loan application are the person’s income; debt capacity; banking behaviour; job stability, and the mortgage and project features. In the past, the MCB’s borrowing rate has varied between 6% and 7.75%. Today, this rate is between 4.9% and 7%. Thanks to this decline, our customers benefit from a home loan, while at the same time meeting the expectations of their project. "
Nirish Beeharry, Executive Director, BCP Bank (Mauritius)
"There are different types of profiles when it comes to Mauritian buyers: there are first-time buyers, those who want to invest in a second home, parents who buy for their children, young people who are starting to work or young couples. As for foreigners, there are a lot of retired migrants interested in living in Mauritius. Some do not want to expatriate but seek to acquire property in preparation for retirement or to enjoy as a second home.
Housing Loans have a much lower interest rate than other types of loans. The Government, through the Bank of Mauritius, has set up numerous incentives to open access to affordable loan facilities for Mauritian residents. In Mauritius, real estate products are very diversified: houses, apartments, villas, secure residences, and off-plan sales (VEFA). The market accessible to foreigners is facing a proliferation of residential real estate projects (IRS, RES, PDS).
The IMMO loan (in Rupees and foreign currencies) is used to finance all housing projects. The bank also offers credit refinancing. The home loan is at a variable interest rate and the amount varies depending on the situation and requirements of the customer and his ability to repay. Note that in certain conditions, repayment can be up to 30 years. At BCP Bank (Mauritius), we set prerequisites for opening an account around which our product offerings are developed. As benefits, we offer extended hours, including Saturdays, personalised service, and a competitive "plus" with the Modulo option, for a flexible payment at no additional costs, allowing the customer to pay back more quickly. "
Shehryar Bakht Ali - Head of Retail Banking, Bank One
"Bank One’s state-of-the-art housing loan offer meets the needs of both Mauritian and foreign borrowers. The average age of borrowers is normally in the 35 to 50 age range. At Bank One, we have seen an increase in the number of first-time homebuyers with a predominance of couples compared to individual buyers.
The main demand for housing loans mainly involves the construction, purchase of a real estate for personal use or as an investment. At Bank One, we support our clients with sound advice to help ensure that their financial independence objectives are achieved in a progressive manner. We have seen a significant increase in our housing loan portfolio due to our highly attractive offering and competitive rates.
Bank One is competitively positioned in the market with a maturity of up to 35 years, up to 100% financing in some cases and very competitive rates in all segments. Thus, we can also offer a rate as low as 4.75%; according to the risk profile of the client. In addition, we offer our customers special discounts from various home furnishing and interior design partners such as Teak World, IOI Network Ltd., Tempur, Hälsa, to list a few examples to complement the overall offer. Customers can benefit from these offers by using only Bank One cards when paying at partner outlets. Not to mention that they can also benefit from up to 1% of Cashback on the amount of purchases with Bank One credit cards; in complement to the benefits and discounts offered in our loyalty program.