NHF housing loans: what staff need from you
What a Nigerian employee needs from their employer to apply for an NHF housing loan, and how the one-third income limit shapes repayments.
By Achekam · · 5 min read · For Running a business businesses in Nigeria
Sooner or later an employee knocks on the office door with a housing question. They have found a flat, or a plot, or a builder, and someone has told them the National Housing Fund lends money to contributors. What they need next is mostly paper, and a surprising share of that paper comes from you, the employer.
This article is for Nigerian owners, HR leads and payroll officers who want to answer that request quickly and correctly. It sets out what FMBN says about who can borrow, what an application needs, where the employer's records come in, and the limit FMBN places on how much of a salary can go to repayments.
Contributions come first
FMBN's FAQ says the NHF contribution of 2.5% of monthly gross salary qualifies a contributor to borrow from the national pool of NHF funds after contributing for a minimum of six months.
So the first thing to check, before anyone fills in a form, is whether the employee actually has six months of contributions behind them. That depends on two things the employer controls: whether NHF was deducted from their pay, and whether it was remitted to FMBN with a schedule that credited it to their participation number. A deduction that sat in the business's account, or a remittance with no schedule, does not help the employee here.
If your NHF set-up is still new, start with registering with FMBN for the National Housing Fund, because the participation numbers it describes are what make an employee's history visible.
What FMBN says it lends
According to FMBN's FAQ, an NHF contributor can borrow a maximum of ₦50 million, repayable over a maximum period of 30 years at an interest rate of 6%. The FAQ page is undated, so treat these terms as correct at the time of writing and have the employee confirm them with FMBN or the lender handling the application.
FMBN also offers products shaped around employment. Its FAQ says the Rent-to-Own product and the Home Renovation Loan are structured for the formal sector, with payments deducted at source by the employer, and that self-employed individuals are therefore not eligible. If an employee mentions either product, they are relying on you to make deductions from their pay every month for a long time.
The documents, and which ones come from you
FMBN's FAQ lists the documents required for an NHF loan application. Among them are a three years tax clearance certificate, evidence of NHF participation and pay-slips for the previous three months. The full list also includes the application form, title documents, a valuation report or bill of quantities, and the equity contribution.
Here is how that list divides between the employee and the business:
| Document | Who usually produces it |
|---|---|
| Application form | The employee |
| Three years tax clearance certificate | The employee, from their tax authority; your PAYE remittances sit behind it |
| Evidence of NHF participation | The employer's NHF records and remittance schedules, plus the employee's participation number |
| Pay-slips for the previous three months | The employer's payroll |
| Title documents, valuation report or bill of quantities | The employee, with the seller or builder |
| Equity contribution | The employee |
The employer's share is small but essential. Late or missing payslips, or NHF records that cannot be matched to the person, hold up an application that is otherwise complete.
The one-third limit on repayments
FMBN's FAQ says only one-third of an applicant's monthly income may be used to service an NHF loan, because no organisation can deduct more than one-third of an applicant's monthly income for any loan under the Labour Act of 1974. That is FMBN's description of the Act; check the Act itself, or ask your adviser, before relying on it.
For the employer, the practical point is that loan deductions add up. If the same employee is already repaying a salary advance or a staff loan to the business, look at the combined monthly deductions before you agree to take on another one. Saying no early is kinder than a payslip that leaves someone short every month.
What Achekam does on the payroll side
Payslips are the easiest part. In Achekam, payslips are PDFs carrying the business's logo and details, downloaded or e-mailed one per person. An employer setting can send them automatically when a run is approved, with a delivery log showing what went out. E-mailing needs an e-mail service configured on the server. For a loan application, download the last three months for that employee and hand them over, or confirm they already have them.
Achekam also records salary advances and staff loans and recovers them from each pay run until they are repaid. That feature is for money the business itself lends. If the business helps an employee with part of their equity contribution, for example, record it there so the recovery happens on every run without anyone remembering to key it in.
Nothing in Achekam is specific to repaying an NHF mortgage through payroll. If the lender asks you to deduct repayments at source, agree with your adviser how that deduction will be set up and recorded, and keep the lender's written instruction with the employee's file.
A short routine for loan requests
- Confirm the employee has at least six months of NHF contributions deducted and remitted under their participation number.
- Download their payslips for the previous three months.
- Pull together your NHF remittance schedules and payment records for their months of contribution.
- Point them to FMBN's own list for the documents that are theirs to supply.
- Before agreeing to any deduction at source, check their total loan deductions against the one-third limit as FMBN describes it.
- File the lender's instruction and any agreement with the employee's records.
FMBN publishes its answers on its NHF frequently asked questions page, covering eligibility, loan limits and terms, and the documents an application needs. For what the contribution looks like on a payslip in the first place, see National Housing Fund deductions for Nigerian staff. The best preparation is simple: remit on time, with schedules, every month, so that when the knock on the door comes the history is already there.
General guidance only, not advice on your own circumstances. Tax and payroll rules change: check the current position with the authority or your adviser.
