Missing Out On KMRC-Backed Single-Digit Loans: A Costly Regret for A New Homeowner

We recently interviewed a new homeowner who was filled with a mix of emotions including excitement, pride, and relief as well as frustration and regret, after reading the latest edition of our Magazine, featuring an insightful article from the Kenya Mortgage Refinance Company (KMRC). Here is what they had to say:

I am frustrated because I recently learned about the single-digit loans offered by KMRC, and I regret not knowing about it sooner. As someone who bought a residential home through a commercial rates loan facility obtained from a commercial bank, I can attest to the fact that the interest rates are anything but affordable and predictable.

When I first applied for a home loan, I knew that the interest rate would be a significant factor in determining the total cost of my mortgage. However, I was not fully aware of the range of interest rates offered by different lenders. I also did not understand how the rates could fluctuate over time based on market conditions and other factors beyond my control.
I was not aware of KMRC’s mission to refinance primary mortgage lenders at low interest rates, which in turn could allow these lenders to offer more affordable loans to borrowers like me. I only found out about it after reading the January 2023 issue of the CM Property Digest magazine.

It was frustrating to realize that I could have saved more than 5% in interest rate if I had applied for a KMRC-backed loan. That may not sound like much, but over the lifetime of a mortgage, it can add up to hundreds of thousands of shillings. Plus, the single-digit interest rate is fixed for up to 25 years, which means that borrowers can budget and plan their finances without worrying about sudden rate hikes or economic downturns.

I feel like I missed out on a great opportunity to make my home purchase more affordable and secure but I don’t want other potential homebuyers to make the same mistake. I urge everyone who is planning to buy a home to get informed about the KMRC’s products and services. Don’t assume that commercial banks are the only game in town or that their rates are always the best. Explore all your options and compare them based on the total cost of borrowing, not just the monthly payments.

As for me, I will try to make the best of my situation and pay off my mortgage as soon as possible, so that I can enjoy the benefits of homeownership without the burden of debt. However, I will also keep an eye on the KMRC’s developments and see if there is any opportunity in the future to take advantage of their single-digit rates. After all, it’s never too late to learn from your mistakes and make better choices.

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