RSA holders can now use their pension contributions for mortgage


The Nigerian Pension Commission (PenCom), in line with Section 89 (2) of the Pension Reform Act 2014 (PRA 2014), has approved and released guidelines for pension contributors in active employment to use 25% of the balance of their Retirement Savings Account (RSA) to pay for equity contribution for a mortgage.

Eligibility to benefit from the policy

The guidelines covered pension contributors in active employment, either as salaried employees or self-employed persons. Interested RSA holders (applicants) must meet the following conditions:

  1. Have an Offer Letter for the property duly signed by the property owner and verified by the Mortgage Lender.
  2. The RSA of the applicant shall have both employer and employee’s mandatory contributions for a cumulative minimum period of 60 months, equivalent to five years.
  3. A contributor under the Micro Pension Plan (MPP) is also eligible, provided he or she has made contributions for at least 60 months (five years) prior to the date of his or her application.
  4. RSA holders that have less than 3 years to retirement are not eligible.
  5. Married couples, who were RSA holders, were eligible to make a joint application, subject to individually satisfying the eligibility requirements.
  6. RSA holders, if registered before July 1, 2019, must have their records updated through the RSA data recapture exercise.
  7. Application for equity contribution for residential mortgage shall be in person and not by proxy.

Maximum amount to be withdrawn for a mortgage contribution

The maximum amount to be withdrawn shall be 25% of the total mandatory RSA balance as of the date of application, irrespective of the value of equity contribution required by the mortgage lender. Where 25% of a contributor’s RSA balance is insufficient for payment as equity contribution, RSA holders may utilize the contingency portion of their voluntary contributions (if any).

Eligibility criteria for the mortgage lender

To qualify as a mortgage lender for this purpose, the company must be licensed by the Central Bank of Nigeria, comply with the Contributory Pension Scheme and have a valid Pension Clearance Certificate. The Commission shall publish the names of eligible mortgage lenders on its website.

Interested RSA holders are to contact their Pension Fund Administrators (PFAs) for more information and guidance.

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