How to secure a mortgage in Kenya

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How to secure a mortgage in Kenya

The thought of having a home is exciting, especially if you have a family. However, it comes with its challenges, and it is essential to be prepared. Times have changed and now owning a property is no longer rocket science. You don’t have to have any cash with you to become a property owner. You can purchase a home through a mortgage and use the money on other projects.

Are you in Kenya, and do you have an interest in becoming a homeowner? This is the perfect read for you because it will discuss how you can secure a mortgage. Please read through and find out how your property ownership dream can become a reality.

The Process of Securing A mortgage

Mortgages are easily accessible provided you accept the terms of the lender. Here is how you can secure a mortgage in Kenya. Every stage is critical and should be followed promptly.

Appraisal and Approval

This is a fundamental stage because it is the one that determines if you are qualified for a mortgage. Also, in this stage, the financier establishes the amount you qualify for. You start by making your application to your preferred financier, after which it is reviewed.

How to secure a mortgage in Kenya

After you apply, some aspects are considered, including your income, expenses, age, duration of the contract, and property details. This is the stage where your application may be accepted or rejected.

Property Search

This is the second stage, and it comes if your application was accepted. The financier ensures that you have the details about the property you want to buy. Also, banks can give you several options if you have an issue getting the right property. The options are from different parts of Kenya.

Once you identify the mortgage that suits you, the financier will send an agent to you. Agents also help clients with information about the best institutions to get a mortgage from. However, sometimes you will find that the property owner has liaised with a particular financial institution permitting them to market and mortgage the property.

Mortgage Processing

This comes after the lender has been convinced that you can repay the amount and has approved your loan. All you are required to do at this stage is to give your documents, valuation report, sale agreement, and a letter of offer to the bank.

Offer Issuance

This stage comes after the processing of the mortgage becomes successful. It is here that you are given an offer letter with terms and conditions that govern the mortgage.

How to secure a mortgage in Kenya

However, this stage can’t be complete without you accepting the terms of the offer from the bank.

Instruments Perfection

In this stage, the lender is given the property being used as collateral. However, the perfection of instruments can only come after you have accepted the terms and conditions. The lender will be given the certificate of the property and other documents. After that, they are given the registration materials and title deed.


This is the last stage to securing a mortgage in Kenya. It comes after completing the registration. It is in this stage that the lender pays the amount approved to the borrower or seller. However, this depends on what was agreed by all the parties involved. The payment process can go up to 180 days, depending on how long the property registration takes with the authorities involved.

Documents Required When Securing a Mortgage

The documents required when getting a mortgage depend on the type of mortgage you are applying for. Here are some of the documents for different mortgage categories.

General Documents for Mortgage Application

  • Copy of the title deed or security
  • Offer letter or sales agreement from the seller
  • Valuation report including the cost of valuation
  • Rates and rents for the ground as paid to the city council
  • Life insurance plus its value and a medical report
  • Standing order
  • Copy of marriage certificate if it’s a couple
  • Rental assessment report for landlords who intend to pay the mortgage with rental income

Mortgage Application Requirements for Employed persons

  • Copy of ID or passport
  • KRA pin
  • Three month’s copies of payslip
  • Bank statements for six months
  • Employment letter stating your position, years of services, retirement age, and employment terms

Mortgage Application Requirements for Self-Employed Persons

  • Certificate of business registration
  • KRA or ID pin
  • Book of accounts for three years
  • Original bank statement for one year
  • A brief history of the business operation and nature

Mortgage Application Requirements for Investment Groups

  • Copy of director’s ID or passport
  • Directors copy of KRA pin
  • Group’s KRA pin
  • Each member’s source of income
  • If a member is employed, they should give their three months’ bank statements and payslips.
  • If they are self-employed, they should give the history and nature of the business, certificate of business registration, and six months’ bank statement.

Other application requirements for investment groups include

  • Constitution copy of the group
  • Certificate of incorporation copy
  • Articles and memorandum of association
  • Original bank statements for one year
  • A letter of authorization from the board permitting the borrowing

Mortgage Application Requirements for Companies

  • Director’s copy of ID or passport
  • 3years audited accounts
  • Original bank statements for three years
  • KRA pin copy of the director
  • Company’s KRA pin
  • Company profile
  • Certificate f incorporation certified copy
  • Change of director’s copy
  • Articles of association and memorandum
  • Authorization letter for borrowing from the board of directors

These are the requirements needed for different categories of people. Many people ask if foreigners can get a mortgage, and the answer is yes. However, you need to have a residence confirmation document like the utility bills or your international driving license. The other documents a foreigner must have include CRB report from your country and a residential visa or work permit.


Types of mortgages in Kenya

There are two types of mortgages in Kenya, and here is a deep discussion of each of them.

1.Variable or Adjustable Rate Mortgage

In this type of mortgage, the interest keeps on changing over a certain period. In the beginning, the interest given can be lower, unlike with a fixed mortgage, but it can go up you with time. The tricky part in this mortgage is that there is no actual figure of how the amount can increase, making it riskier, especially for homeowners.

When applying for such a mortgage, you need to state a specific period. It could be three  to five or eight years. During this period, your interest will be constant. But after that, the interest charged will start to fluctuate by either increasing or decreasing. Some of these changes in interest happen mostly once per year.

What Are the Benefits of Variable Mortgages in Kenya

This is a question that any serious borrower will ask a lender. However, there is also the lower side of this mortgage. Here are the pros.

  • Low Monthly Payments -As mentioned earlier, the initial interest of this mortgage is usually low, which means that the amount you pay per month will be equally low.
  • Lower interest Rates-Unlike other types of mortgages, this one has lower interest rates and leaves it in a better place because you can get a big house with a small amount. You should consider the variable mortgage if you are on a tight budget.

Cons of Variable Mortgages

  • No Sale or Refinancing-The is the main con. You can’t sell the property until the period for adjustable rates comes.
  • Risky– Taking this mortgage is a great risk because your monthly payments might increase in interest at any time.

Fixed-Rate Mortgage

In this type of mortgage, the interest amount doesn’t change, just as the name suggests. However, this loan is long-term and can extend up to 30 years. During this period, the interest will remain constant until you are done with paying it. However, several factors determine if you qualify for this loan, including your creditworthiness and current interest rates.

What Are the Benefits OF Fixed Rate Mortgage?

  • Unchanging interest rates
  • The monthly payments are fixed
  • The terms are flexible
  • Easy to make your budget

Cons of Fixed Rate Mortgage

  • The rate of interest is high, unlike with other options
  • Low mortgage size would make you pay more during the agreed term
  • The monthly payments for this mortgage are high.


Mortgages have been a great backbone for the world’s economy. They have also enabled many people to own homes and be comfortable. In Kenya, people have learned the benefits of mortgages and are going for them. In case you have been wondering how you can secure one, this article has been timely. We have discussed the steps involved in securing a mortgage in Kenya and the documents one must-have. Also, you know which type of mortgage you can go for according to your creditworthiness. With this knowledge, you can now go to a financier and start the process of owning the home of your dream. The best part about securing mortgages in Kenya is that even foreigners are not left out.


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