In Ghana, there is often a lot of flexibility in how you finance a property. The most suitable financing option depends on the borrower’s financial situation, credit history, property type, and intended use. Property purchasers should seek legal counsel with any bespoke financing options but prospective buyers should be open to negotiating.

We have categorised the purchase options into the following categories:

1. 100% Purchase
2. Bespoke Purchase Terms
3. Mortgaged Purchase

A 100% cash purchase is what it says on the tin. All cash is used to purchase a property or land, so the purchaser owns the property without any outstanding mortgage or loan secured against it.

Mortgage-free property ownership has several advantages:

1. Financial security: Owning a property without a mortgage reduces financial stress, as the owner is no longer required to make monthly mortgage payments. This can lead to increased disposable income and more flexibility in personal finances.
2. Equity: A mortgage-free property represents the full value of the property as equity, which can be leveraged for other financial goals, such as investing, starting a business, or financing a child’s education.
3. Reduced housing costs: Without a mortgage payment, the owner’s housing costs are significantly reduced. Although property taxes, insurance, and maintenance costs still apply, the overall financial burden is lower.
4. Stability: Owning a property outright provides a sense of stability and security, knowing that the property cannot be taken away due to foreclosure or repossession in case of missed mortgage payments.
5. Freedom and flexibility: Mortgage-free property ownership provides the freedom and flexibility to sell the property, downsize, or relocate without the constraints of mortgage obligations.

Bespoke Purchase Terms refer to customized or tailored terms and conditions negotiated between a buyer and a seller for the purchase of a property.

These terms are specifically designed to accommodate the unique needs, preferences, and requirements of the parties involved in the transaction, rather than relying on standard or generic terms commonly used in similar transactions such as 100% cash payment or a mortgaged purchase.

Bespoke Purchase Terms can cover a wide range of aspects, including but not limited to:

1. Payment structure: Customized arrangements for the payment of the purchase price, such as deferred payments, and instalment plans.
2. Financing options: Unique financing arrangements, such as seller financing or lease-to-own agreements, that may not be commonly available through traditional mortgage lenders.
3. Closing timeline: A tailored schedule for the closing process, which could include extended due diligence periods, flexible closing dates, or a staged handover of the property.
4. Contingencies: Specific conditions or clauses that must be met for the transaction to proceed, such as the buyer securing a specific type of financing, the seller making certain repairs or improvements, or the successful completion of a zoning change application.
5. Warranties and representations: Customized warranties or representations made by the seller regarding the property’s condition, history, or other factors relevant to the buyer’s decision-making process.
6. Post-closing arrangements: Agreements related to the use or management of the property after the sale, such as leaseback arrangements, property management contracts, or rights of first refusal for future transactions.

Some advantages of Bespoke Purchase Terms include:

1. Tailored solutions: Bespoke Purchase Terms allow the parties to create customized solutions that address their specific needs, preferences, or concerns. This can result in a more satisfactory outcome for both parties compared to standard terms.
2. Creativity and innovation: Customized terms encourage parties to think creatively and explore innovative approaches to structuring the transaction, which can lead to more mutually beneficial outcomes.
3. Risk management: Bespoke terms can help both buyers and sellers to better manage risks associated with the transaction by addressing unique circumstances or challenges that may not be covered by standard terms.
4. Flexibility: Customized purchase terms offer greater flexibility in negotiating the various aspects of a property transaction, such as payment schedules, contingencies, or post-closing arrangements. This can make it easier for parties with different needs or objectives to reach an agreement.
5. Increased negotiation power: Bespoke Purchase Terms allow parties to negotiate more effectively by focusing on the specific aspects of the transaction that matter most to them. This can lead to a more balanced agreement that better reflects the interests of both parties.
6. Competitive advantage: For sellers, offering bespoke terms can make their property more attractive to potential buyers, especially if the terms are designed to address common concerns or challenges faced by buyers in the market.

A mortgage is a loan provided by a bank or other financial institution that enables a borrower to purchase a property. The property being purchased serves as collateral for the loan, which means that if the borrower fails to make the required payments, the lender has the right to take possession of the property and sell it to recover their money.

Mortgages typically have a long repayment term, often ranging from 15 to 30 years, and can come with fixed or adjustable interest rates. The loan amount, interest rate, and repayment terms depend on various factors such as the borrower’s credit history, income, and the value of the property being purchased.

In Ghana, there are many mortgage options offered by a variety of banks. It is important that before an individual applies for and enters into a mortgage arrangement they understand all the conditions.  Some products may be for Ghanaian nationals only, some can be for both Ghanaians and non-Ghanaians.

Examples of Mortgages Options:

A. Home Purchase Mortgage

B. Home Construction Mortgage

C. Land Purchase Mortgage

D. Home Improvement Mortgage

E. Equity Release

F. Save-To-Own Mortgage

[We have used First National Bank as a reference for mortgage offers however a variety of banks offer mortgages]

Home Purchase Mortgage

Home purchase mortgages are mortgages used to purchase homes/houses/dwellings.

To get started, identify a house you wish to acquire, negotiate the terms of purchase with the vendor and obtain an offer letter for the property to qualify for the mortgage.

The options include:

• First-time buyer

Designed for first home purchases.

Available to resident and non-resident Ghanaians.

Funds can be in GHS, USD or GBP and up to 20 years to service this home loan.

• Buy-To-Let

Designed for property investors.

This is for purchasers who desire to rent their property out.

Available to resident and non-resident Ghanaians.

Funds can be in GHS, USD or GBP and up to 20 years to service this home loan.

• 100% Purchase

Designed for first home purchases.

This is for purchasers who are unable to raise the minimum deposit amount.

Available to residents only

Funds can be in GHS, USD or GBP and up to 20 years to service this home loan.

• Home Purchase Loan

Designed for property investors and first time buyers

Available to resident and non-resident Ghanaians.

Funds can be in GHS, USD or GBP and up to 20 years to service this home loan.

Home Construction Mortgage

Home construction mortgages are mortgages used to build from scratch or complete home construction.

The options include:

• Home Construction

Designed for home construction.

This is for individuals that own land, and have building plans, but don’t have the funds to build the home.

This is a two-part loan which comprises an initial one-year interest-only construction loan rolled into a mortgage facility that is repaid over a longer term.

• Home Completion

Designed to finish a property, and get it to living standards.

The use of this product is to purchase materials such as roofing materials, windows, doors, tiles, and all other finishing products to complete your property.

This is a two-part loan which comprises an initial one-year interest-only construction loan rolled into a mortgage facility that is repaid over a longer term.

Land Purchase Mortgage

Helps investors own already serviced parcels of land.

Buy a serviced plot of land, payable in 3 to 5 years.

For land that is pre-designated for residential use

Home Improvement Loan

This mortgage allows property owners to borrow long-term, using their homes as collateral to get funds to revamp their property.

Equity Release

Equity release is a financial product that allows homeowners to access the equity that they have built up in their homes.

This money can then be used to invest in further property or personal consumption.

Save-To-Own

This product makes it easier for individuals to get on the property ladder, if they are self-employed and do not have a regular flow of steady income, or you simply don’t have all the money required to make the required down payment on a house.