Qualifying Criteria

All NHFC loans and facilities, offered through its Funding Programs, must eventually and indirectly enable homeownership, rental, and/or improvements of property to the low- and middle-income South African households earning between R1 500 and R15 000 per month.

The NHFC Credit Committee defines the terms and conditions and the required qualifying criteria that must be met for the granting of NHFC housing finance / loan facilities. The qualifying criteria and required supporting documents vary depending on the selected Funding Program option, but broadly, include the following conditions:

Qualifying Criteria

Required Submissions:
  • Subscribe to the aims of the NHFC to address housing needs of the defined Gap market
  • Enjoy a sound reputation and be known for their integrity
  • Possess appropriate technological and intellectual capacity
  • Demonstrate that they have appropriately trained staff in terms of the specific functions they are required to perform
  • Retail Lending Intermediaries are required to conform to 20% capital adequacy requirements, whilst Private developers/landlords are required to contribute at least 10% of the project cost as Equity. The equity amount will be determined by cash-flows of the financed projects and its ability to carry all operational expenses and financial obligations.
  • {with the exception of SHIs, which are allocated RCG by the SHRA}
  • A detailed Business and Project Plan with details on:
    • Company mission, vision & strategic objective(s)
    • Type of the legal vehicle 
    • Description of the project concept, with the following supporting documents:
      • Marketing Research report
      • Funding structure
      • Pricing of loans in case of Retail loans
      • Tenure option (where applicable)
      • Selling Price in case of bonded units for sell-off and rentals to be charged for rental units
      • Cashflow and profitability projections of the projects to be developed
  • Audited financial statements for the last two years for existing business and projections for start-up entities
    [where the financial year ended 3months prior to loan facility application, provision of up-to-date monthly Management Accounts is required]

In all cases, the NHFC will have to be satisfied that the institution is viable in the long-term. The size of the loan facility will be based on the potential market, the capacity of the institutions to manage growth and the project's ability of to generate sufficient revenue.

 

How to Apply

When seeking an NHFC Projects and Commercial Loan Facilities, the applying entity must submit a formal letter of introduction accompanied by the Required Submissions as listed above; the Checklist offers further information needed to support the application.

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