Mortgage approval does not guarantee the keys to your home, Absa says
The bank says borrowers who have secured mortgage approval still have to navigate ownership verification, legal documentation, payment of taxes and other transaction costs, approvals and registration of the property before the purchase is completed.
Nairobi, Kenya – Securing a mortgage approval from Absa Bank Kenya does not automatically mean a homeowner will receive the keys to their new property, according to the bank. Absa Bank Kenya's Head of Mortgage, Beatrice Chege, explains that the mortgage process extends beyond the approval stage and involves numerous legal and conveyancing steps before the property is officially transferred and registered.
This includes ownership verification, preparation and signing of necessary legal documents, payment of taxes and transaction costs, and the registration of the property. The bank emphasizes that during this stage, various parties such as the buyer, buyer's advocate, and the lender's legal representatives must collaborate, and multiple documents must be completed to ensure a smooth transaction.
Potential delays can occur due to document handling issues, government office interactions, or borrower disengagement after the lengthy approval process. Additional costs such as stamp duty, legal fees, registration charges, valuation costs, land rates clearance, and insurance premiums may also be required, depending on the specific transaction.
These costs can lead borrowers to seek additional funding before the transaction is finalized. Absa Bank Kenya advises borrowers to budget for these expenses and encourages digital support throughout the mortgage process, using online platforms for document uploads and signatures. The bank's concerns align with the Kenyan government's ongoing efforts to digitize land records and improve land administration services, aiming to reduce delays in title verification and land searches that negatively impact credit costs and deter investment.
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