Changes to of­fer­ing of new hous­ing mort­gage loans

Following the ruling of the Supreme Court of Iceland in an interest case against Íslandsbanki on 14 October 2025, Landsbankinn has made changes to its offering of housing mortgage loans.

These changes only extend to new housing mortgage loans and have no impact on borrowers with current housing mortgages with the Bank.

The main changes are:

• We offer a new option, which is to fix interest rates on non-indexed housing mortgages for a 1-year period. The interest rate on such loans is currently 8.60% and the loan carries no pre-payment charge.
• Previously, the only fixed-rate periods on offer were for 3 and 5 years.
• By fixing the interest rate for 1, 3 or 5 years, the best available rates the Bank offers each time are available, from 8.15%. The interest rate is based on the loan-to-value ratio.
• New variable interest rate on non-indexed housing mortgages will carry a fixed interest rate premium on the Central Bank’s policy rate at each time.
• Housing mortgages will be one loan, dispensing with base loans and supplementary loans on higher terms.
• First-time buyers can borrow up to 85% of the property’s value while others can borrow up to 80%. The loan term is up to 40 years.
• Inflation-indexed housing mortgages will only be available to first-time buyers. They will have a 20-year term and carry a fixed interest rate throughout the loan term.

We have offered very competitive terms on housing mortgage loans and exceptional service at Landsbankinn around the country. We will continue to do so.

An interest payment ceiling will be available to customers who experience temporary payment difficulties. This involves carrying part of interest payments over to the loan principal.