Non-indexed housing loans with floating rates

Non-indexed mortgages with floating rates are suited to customers who wish to pay their loans off more quickly and avoid accumulating inflation compensation on the principle. Mortgages are available for the purchase of real estate, refinancing of loans, new construction or housing improvement purposes.

Term of loan

  • The loan has a term of up to 40 years.
  • A supplementary loan is an amortised loan for a maximum period of 15 years.

Amount of loan and LTV

  • The maximum loan amount is up to 70% of the property's market value or valuation and a supplementary loan can be taken out to finance up to 85%.
  • The lending percentage cannot exceed the combined fire insurance assessment value and plot value of residential housing.
  • First mortgage rights are required and the real estate must be owned by the borrower.
  • Minimum housing loan is ISK 1 million.

Interest

Instalments

  • These are variously amortised or equal payment on principal loans.
  • Repayment of supplementary loans is in the form of monthly equal instalments on the principal.
  • Instalments are made monthly and the applicant can select the day of the month.

Fees

  • A stamp duty of 1.5% goes to the national treasury (no stamp duty is charged on the first real estate purchased).
  • Until 31 December 2011 (according to law) no stamp duty is charged on refinancing of housing loans. No stamp duty is charged on the tranche of the new loan comparable to the recalculated value of the older loan, plus default.
  • In the case of refinancing, only half the stamp duty is charged, or 0.75%.
  • Fee for registration accrues to the national treasury.
  • Borrowing charge of 1%.
  • No borrowing charge applies to refinancing of Landsbankinn loans, since the borrower has already paid the fee.
  • No payback charge.
  • Other fees as per the bank's current tariff.

More favourable terms for first-time real estate purchases

  • Borrowers purchasing their first real estate and who service their debt promptly get yearly refunds from the bank at the end of each year for a period of three years.
  • The refund amounts to 0.25 percentage points of paid interest on the loan and is payable to the borrower's account for debit.

Are you a member of Varðan?

  • Members of Varðan are charged a lower borrowing charge, or 0.5%.
  • They are also rewarded ISK 5,000 in Aukakrónur if they are members of the benefits system.

Other information

  • The borrower must pass credit assessment.

Loans