You can easily apply for a loan online. The first step is to complete a credit assessment which only takes a couple of minutes.

If you want to get a clearer picture of your payment capacity without completing a credit assessment, you can use the credit calculator to arrive at an estimate.

• More about credit assessments
• Complete a credit assessment and apply for loan
• Make an appointment for financial advice

The purpose of a credit assessment is to gauge your ability to service your mortgage once other expenses are considered, such as cost of living, vehicle operation, other loans, etc.

Keep in mind that it may not be advisable to utilise all your estimated payment capacity as calculated in the credit assessment. You want to be able to do more than buy food and pay off your mortgage.

The maximum loan term depends on the type of loan. Non-indexed loans can have a term of up to 40 years while inflation-indexed loans may have 5-25 year terms. We do not grant supplemental loans when refinancing.

For refinancing, the maximum mortgage is 70% of registered real estate value.

Make an appointment to see us if you require a loan in excess of ISK 60 million.

With equal instalments, the same amount is paid to the principal of a loan, with accumulated interest added to the instalment. This leads to steady asset formation over the loan term. Debt service is higher initially and decreases with time to finally be lower than debt service on an annuity. 

Equal instalments (annuity) mean that you equalise your monthly debt service. You only pay a small amount to the principal initially while the interest is still high. As interest decreases, you pay more towards the principal and towards paying the loan off. Annuity means that payments are equal on each due date, excepting indexation. Repayment of the principal is very slow in the beginning and asset formation speeds up towards the end of the loan term.

Interest rates can be fixed for 36 or 60-month periods while variable rates are based on the interest rate tariff at each time. When a fixed-rate period ends, the interest automatically reverts to a variable rate if a decision is not made to renew the fixed-rate period. 

A borrowing charge of ... is charged on both new loans and refinancing.

The borrowing charge on housing and real estate mortgages indexed to a foreign currency is ....  

There is also cost associated with the credit assessment and public registration of documents.

We cancel the borrowing charge for first-time buyers. If two parties are purchasing real estate together and one of them is a first-time buyer, the borrowing charge is also cancelled.

Loans that carry variable rates carry no pre-payment penalty.

If your loan carries a fixed interest rate, a pre-payment penalty may apply, yet only if the fixed rate on comparable loans are lower than on your loan.

• The pre-payment penalty can at a maximum amount to 0.2% for each whole year outstanding on a fixed-rate period and never exceed 1% of the pre-paid amount.
• Pre-payment of up to ISK 1,000,000 per calendar year can be made without incurring a pre-payment charge.

Pre-payment penalties vary between credit institutions.

Our advisors can help you figure out how the pre-payment penalty affects your loan.

When you take a loan, you always pay interest on the outstanding amount of the debt. If you spread debt service over a longer period, you lower your payment burden yet pay interest throughout the period.

A shorter loan term means that you pay the loan off quicker and also shorten the time you pay interest. Shorter term loans are less expensive even though the debt service is higher.

The interest rate on housing mortgages is determined by the current interest rate tariff at each time. If the mortgage ratio is under 60% of registered real estate value, you pay lower interest. The interest rate is even lower if the mortgage ratio is below 50% of registered real estate value. See the interest rate tariff.

The interest terms will be determined by the current interest rate tariff at the time you apply for fixed rates. It is possible to apply to fix the interest rate on all basic loans.