By Mohammed Affum
Accra - Home Finance Company (HFC) is taking an initiative to facilitate housing delivery which other institutions can emulate. This is the provision of funds to cash-strapped developers to enhance the construction of houses for buyers.
Recently, ?500 million was made available to a developer, said Mr. Harry Quartey, officer-in-charge of Construction Finance Unit, set up to administer and manage the funds for developers.
To qualify for the facility a developer must have a very good performance record, proof of marketability and three years audited accounts.
The philosophy behind the creation of the Construction Finance Unit is to address the problem of lack of finance for construction .
"HFC is thus doing its best to promote the growth of mortgage financing in the country," according to Quartey.
The fund is therefore, expected to meet the high demand for housing delivery buy which is inhibited by shortage of funds on the part of developers to build houses on schedule.
In financing developers, HFC advances loans at every stage of development upon inspection by its officers.
However, only a few developers have accessed the facility, that is why efforts are being made to educate them, especially members of GREDA on the C.F.U.
The facility is available for development within 40 kilometers radius of all major cities in the country.
Quartey said a developer can take the facility as many times as possible provided the developer fulfils his or her obligations to the company on previous loan agreements.
Among the facilities being offered are construction stage payment and the construction line of credit through other financial institutions.
The HFC construction stage payment facility is available to assist real estate developers who are already building housing units for HFC prospective mortgagors and require additional funds to complete the homes.
Funds are extended directly to the developer and it is repaid by the developer with interest, from the proceeds of the completed houses, within a specified time frame.
In the second option, payments are made to developers with the consent of the purchaser/mortgagor. It is a condition that the advance be made only in respect of homes whose purchaser has an approved mortgage loan with the company.
