The maximum home loan and price you can afford from income and existing debts.
Max property price
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Max loan
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Max monthly payment
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Worked example
Take a gross annual income of N24,000,000, which is N2,000,000 a month, with N200,000 of existing monthly debt and an N10,000,000 deposit, at a 28% rate over 20 years and a debt-to-income cap of 33%. The cap allows total monthly debt of 33% of N2,000,000, which is N660,000. Subtracting the N200,000 you already pay leaves N460,000 as the maximum mortgage payment. Reversing the mortgage formula at 28% over 240 months, that payment supports a loan of about N19,636,541. Adding your N10,000,000 deposit gives a maximum property price of about N29,636,541. Because Nigerian rates are high, the affordable loan is very sensitive to the rate, so it is worth testing a few rates around the one you expect.
Item
Amount (NGN)
Max monthly payment (33% less existing debt)
460,000
Max loan the payment supports
19,636,541
Deposit
10,000,000
Max property price
29,636,541
How it is calculated
Affordability works backwards from what a lender will let you pay. First it caps your total monthly debt at your chosen debt-to-income ratio applied to gross monthly income, then it subtracts your existing monthly debt to find the room left for a mortgage payment. That maximum payment is fed into the mortgage formula in reverse: the loan it supports equals the payment times one minus the quantity one plus the monthly rate raised to the negative number of months, all divided by the monthly rate. The monthly rate is the annual rate over twelve and the months are the term in years times twelve. Adding your deposit to that loan gives the maximum property price. Lenders in Nigeria commonly cap the ratio between a third and 40 percent, and because rates are high the supported loan moves a lot with small rate changes, so treat the result as a guide and confirm the exact figure with your lender.
Frequently asked questions
How much mortgage can I afford in Nigeria?
Lenders cap your total monthly debt at a share of your gross monthly income, often around a third to 40%. Your maximum mortgage payment is that capped figure less any existing monthly debt. The loan that payment can support is then found by reversing the mortgage formula at the lender's rate and term. Add your deposit to that loan to get the maximum property price. Because Nigerian rates are high, the affordable loan is sensitive to the rate, so test a few rates.
What debt-to-income ratio do Nigerian mortgage lenders use?
Most Nigerian commercial banks cap total monthly debt payments at around 33-40 percent of gross monthly income, though the exact limit varies by lender and borrower profile. This calculator defaults to 33 percent, which is a commonly cited ceiling. If you have dependants or irregular income, modelling a lower ratio such as 25-30 percent gives a more conservative affordability estimate.
Does a larger deposit meaningfully improve affordability in Nigeria?
Yes, in two ways. A bigger deposit directly reduces the loan you need to borrow, lowering the monthly payment and the total interest cost. It may also make lenders more willing to approve the loan and could improve the rate offered, since a lower loan-to-value ratio reduces their risk. In Nigeria, deposits of 20-30 percent are common for prime property purchases. Enter different deposit sizes in this calculator to see how each shifts the maximum property price.
How does the National Housing Fund help with mortgage affordability?
The National Housing Fund scheme, run through the Federal Mortgage Bank of Nigeria, offers contributory workers access to mortgage finance at rates below commercial bank rates, improving affordability compared to a market-rate loan. Eligibility requires consistent NHF contributions. This calculator models any interest rate you enter, so you can compare an NHF rate against a commercial rate by running the tool twice and comparing the maximum loan each supports.