We don't start any project without first having a valid budget for it, and making sure the client's verified regular net monthly income can repay the project comfortably now after completion and/or in the future.
The minimum net regular verifiable monthly income of GHS5,000, is only the starting point.
A. EXISTING DATA REGULAR INCOME DATA
Typically used for permanently employed public or private sector salaried workers, and to some extent registered businesses with statutory filing records.
A1. INCOME MULTIPLE APPROACH (SIMPLE)
This option is quite simple, as we just multiply the gross annual income by a factor of 8, to get the maximum project budget (a ceiling a client cannot have a project cost beyond). Note: you can use the net income (instead of the gross), to get a more closer estimate - However, we use the gross to only accommodate any salary increases over the subsequent years.
Example:
If the client's gross regular monthly income is GHS10,000, his/her annual gross will be GHS120,000.
From the above gross the maximum project budget = 8 x GHS120,000 = GHS960,000.
So, this GHS960,000 is not the project cost, but a ceiling we cannot do a project for this client above GHS960,000.
A2. 50% THRESHOLD APPROACH (COMPLEX)
This is an amount arrived at by multiplying 50% of your current verified net regular monthly income by the number months remaining until retirement at age 60 for all owner-occupier residential projects for Public/Private Sector Salaried Workers.
Note that however, that half the net regular monthly income for non-salaried workers (registered business owners and registered entities) is multiplied by 120 months (10yrs).
We choose the 50% threshold of your regular net monthly income because we don't expect you to repay with more than half of your monthly income.
B. NON-EXISTING REGULAR INCOME
This is typically for projects that do not have an existing income history.
MAXIMUM PROJECT BUDGET COMPONENTS
The Maximum Project Budget is made of the cost of the project after project estimate + the cost of construction financing.
Maximum Project Budget = Bill of Quantities (BoQ) + Pre-Construction Costs
The Maximum Project Budget is the maximum figure your project plus finance interest cannot go above.
EXAMPLES
Table 1: Owner-Occupier Residential Example
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Table 2
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RELATED PAGES
The Building Construction Process
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