In Sparebanken Øst, you can now get a mortgage rate we have never seen before in Norway. The bank predicts a tougher battle for mortgages in the future.
Sparebanken Øst boasts in a recent press release that as of today, the bank probably offers the lowest mortgage interest rates in Norwegian history. This is done through the operating concept Nybygger.no, where the effective interest rate is a record low 1.10 per cent.
Sparebanken Øst has not been able to find that lower mortgage rates have ever been offered in Norway before. The bank believes that after the corona pandemic, the Norwegian banking industry must adapt to the new normal with lower margins going forward. In that case, it will benefit the customers.
And Sparebanken Øst gives the same interest rate to everyone. The bank thus has no discrimination or provides special benefits to members of large employee organizations.
No membership requirements
The online newspaper wrote in the wake of the interest rate cuts this spring about the price war in the fixed income market. The lowest mortgage rate at that time was 1.30 per cent in Danske Bank. But this interest rate was not reserved for so many.
The offer in Danske Bank only applied to academics under the age of 34, while members of the organization Akademikerne over the age of 34 were allowed to borrow from the bank at 1.40 per cent.
Director of Marketing and Digital at Sparebanken Øst, Eivind Christiansen, informs Nettavisen that there are no requirements for new housing to get the new super condition. According to Christiansen, you can borrow to buy a home or refinance your current home. You can thus move your loan and get down to 1.10 percent.
Up to 75 percent
But there are some limitations. For a regular repayment loan, the loan must amount to a maximum of up to 75 per cent of the estimated market value of the home. In addition, the loan must exceed NOK 2 million.
If you take out a loan of NOK 2 million with a repayment period over 25 years, you will have to pay NOK 7,610 in interest and installments to begin with. (annuity loan), given 1.10 percent in effective interest.
If you take out a so-called framework loan in Sparebanken Øst, call it a home loan, the new super conditions apply from 2 million and up. But here the loan must only amount to up to 50 percent of the value of the home.
For such loans / credits, there is no requirement for a repayment period, but an upper loan limit you must stay within. You pay interest on what you have drawn up on the loan / credit at any time and no installments.
Sparebanken Øst writes in a press release on Friday that competition for mortgage customers has increased over the past two years.
But the bank has seen that loan products are constantly being offered that require special membership, age and / or specific product combinations in order to gain access to the lowest mortgage rates.
The online newspaper has written about this a number of times: The most favorable conditions are reserved for members of large employee organizations through collective agreements. Sparebanken Øst now gives a little boost to competitors.
“With us, you do not have to be a member of an organization or association or be in a special age group to get our best interest rate. On the contrary, we think that the best mortgage customers in Norway deserve the best interest rate in the market “, says customer director, Kjartan Reve in Sparebanken Øst in the press release.
The bank believes that many of the individual customers pay unnecessarily high interest rates and fees for their mortgages today.
In addition, Sparebanken Øst points out that through the corona pandemic they have chosen a restrained and cautious growth strategy. The time is therefore ripe to use competitiveness and solidity to provide customers with good offers.