Discount on mortgages

How your interest rate is determined and how you can get a discount on it

Each bank has a list price with an official interest rate that they offer to its customers. But almost all banks also offer a certain discount on this base rate. Therefore, there is a lot of money to save for you as a borrower by asking for such a discount.

The banks' list rates are only an initial interest rate
The banks 'list rate is the banks' interest rate without discount. Almost all banks offer a discount, which means that the actual average interest rates the banks lend to are often significantly lower than the interest rates that the banks advertise with. Since 2015, banks are also obliged to report the average interest rate on which they lend. Therefore, take a close look at the average interest rates when it's your turn to negotiate mortgage rates.

Compare and find the best mortgage discounts

You who compare and actively negotiate the interest rate have the greatest chance of getting a discount on your mortgage rate. However, there are services that help you compare the banks' interest rates and negotiate them for you.

The discount usually lasts for just one year

An important aspect to keep in mind when negotiating a discount on your mortgages is that in most cases, the discount is only guaranteed for one year for moving three-month loans. After that year, a renegotiation takes place in which the discount can be raised, lowered or even disappeared. Therefore, be sure to get a clear message about how the opportunity for renewal of the discount looks.

When you negotiate a discount, it is often also incumbent on you to be motivated to keep the discount.

When you negotiate a discount, it is often also incumbent on you to be motivated to keep the discount. If you do not contact the bank or if the bank does not get hold of you when the discount ends, there is a risk that the discount will expire. Often, just a phone call from your side is required to keep the discount and thus save a lot of money.

New Customer Discount

A special kind of discount that you should be careful about is the so-called retail customer discount. New Customer Discount is an offer for new customers who give you a discount on your home loan for a limited period of time. Because the discount usually only applies in the first year, it may ultimately be worth choosing a discount that does not give as much discount but lasts for a long time.

6 questions to ask the bank about your mortgage tax

1)How many discount points do I have in the interest you offer me? This is certainly relatively easy to calculate based on the listed rate, but it is equally good to get it black on white. Your discount will depend on your bank commitment and how well you are able to bounce on the interest rate.


2)Is any part of the discount a new customer discount that will disappear? If so, when does it disappear and how much is it? If the bank has a new customer discount, it is, of course, important to find out how big it is. Because you will pay back on your home loan for a long time, you should not include a possible new customer discount in your comparison if you do not make a very detailed calculation.


3)How long is it for the discount? As a rule, the validity of the discount is one year. The alternative is that you have a permanent mortgage discount that does not change unless the conditions for the loan change.


4)What do I get for a discount when the term of the mortgage payment is over? Often, the discount depends on whether your finances or market factors have changed. The bank will most likely not be able to answer exactly what you will get for a discount but what you want to know is whether the discount will be reduced sharply or if it will be the same.


5)How do I remind you that my discount needs to be renewed? You always get an avi from the bank when your loan changes. This also applies when the term of the mortgage payment expires. Sometimes the banks can be very unclear in their aviary and if you do not read the avians carefully you can easily miss it. Often, banks report this via email notifications on the web bank or through a telephone call. By asking in particular you know what to expect.


6)What if I do not actively renew my mortgage tax? If you or the bank do not pay attention when the resale tax is renegotiated, it will result in the discount being eliminated. However, it is worth getting it confirmed.

Mortgage without cash

Think about whether you want to lend to the cash bet

Since 2010 there have been housing mortgages, which means that home buyers themselves have to save up to a cash deposit equivalent to 15% of the purchase price. As a rule, you must have your cash deposit ready before applying for a home loan.

However, you can get a home loan without a cash deposit by applying for a cash deposit loan.

The cash contribution can be financed with a loan

The requirement for cash in case of housing purchases exists to protect borrowers from overpaying. However, the requirement has also meant that some groups who find it difficult to save themselves for a cash deposit have made it more difficult to enter the housing market. This is a big problem for many, especially young, home buyers and that is something that many lenders also saw.


To solve this problem, some lenders offer and offer their customers an opportunity to lend to the cash contribution - a so-called cash loan. A cash collateral loan is not a home loan as collateral without a normal private loan, which means that it is not covered by the rules on mortgage loans.

What does it mean to lend to the cash contribution?

 To lend to the cash contribution means that the lender instead of having a mortgage loan has two separate loans: a mortgage loan and a private loan. The home loan, which may amount to a maximum of 85% of the purchase price, serves as a common mortgage with the home as collateral and private loan, which is the remaining 15% of the purchase price, finances the cash contribution.

Having two loans instead of one means that the borrower must, of course, have to pay back on both loans and therefore the cost of the loan will also be higher than if the borrower only had a mortgage loan.

To consider before borrowing for cash Financing the housing purchase with both a home loan and a cash loan can sound like a good and smooth idea. But just like with all long-term financial commitments, you should make a careful calculation of your financial conditions. You should always have the financial conditions to be able to pay back on all the loans.

Because you have to pay interest on a cash deposit loan, it's generally cheaper to save you a cash bet than borrow it. On the other hand, a cash loan can be a great solution that suits you and your situation perfectly when you need relatively fast somewhere to live. Only you can make that balance.

First, check if you can afford mortgages and cash deposits
A good start is to get the calculator and start counting on what expenses you have and what a cash loan and mortgage loan would mean for your finances.

What is your housing cost today and what would it be if you borrow and buy a home instead? If you live in a very expensive second-hand apartment, it may even be cheaper for you to buy a home instead.

How do your earnings look today and how will it look in the future? If you have a solid job with a good salary, you probably have a better financial starting position than if you have temporary employment.
Be careful in examining your finances before borrowing so you avoid unpleasant surprises once you have bought a home.

Mortgage Insurance

Mortgage insurance is an insurance policy that pays your interest and amortization if you were to become unemployed or to suffer from illness or an accident. Like all insurance, it is paid a monthly premium. A mortgage loan provides a great deal of security for you as a borrower, as you do not worry about being unable to repay the loan.

A mortgage insurance will help you if you can not pay
Like all insurance policies, mortgage lending is an additional protection when something unforeseen occurs. Before a lender grants you a mortgage, a risk assessment is made on you as a borrower in which it is investigated whether or not you will be able to repay the loan.

Tip! A mortgage loan protects you against unforeseen events that will prevent you from paying back on your mortgage.

If you have been granted a home loan, it means that at least the lender believes you are able to repay the loan under the conditions that prevail when you make your loan application. Mortgages insurance is only actualized when, for some reason, you suffer from loss of income and can not repay the loan.

Lenders usually recommend mortgage loans

Mortgage insurance is a broad insurance that most people with a home loan can use. The risk of suffering from a disease that makes you unable to work is just as great for all people. On the other hand, there are some groups that can benefit in particular from a mortgage loan insurance:

Young: Mortgage insurance is often raised as a good idea for young leaders who have not yet gained a strong position in the labor market, as they often run a higher risk of becoming unemployed when changing workplace economies. In addition, the premium for mortgage loans is usually lower for young borrowers.

At high loan ratios: Insurance companies usually recommend high-mortgage households to subscribe to mortgage loans because such households are particularly vulnerable if the accident occurs.

Self-employed: Even if you run a very profitable company, it is recommended to have a mortgage insurance as your own business owner. This because this form of employment represents a higher risk than for example a permanent employment.

If you are going to sign a mortgage loan or not a balance you have to make, just like any other insurance. It's hard to say what's right for you. However, it may be good to review mortgage loans to keep track of what it would cost. Aside from mortgage insurance, it is very important that you sign the necessary insurance to protect your home. You can read more about this under insurance.