Category Archives: Loan

What are the common terms and conditions that apply to mortgages? – Loans

As we have mentioned many other times here on the site, mortgages are a very large loan that will have a significant impact on the private economy. Since it is such a large loan, it is extra important to keep track of all the terms and conditions that apply to the loan.

The lender will always give you the opportunity to read through the terms before signing any paper so you never have to worry about it. Furthermore, there are always the terms and conditions for the lenders’ mortgages posted on their websites where they can be read at your own discretion.

But to give you a little basic overview, here are some things that are included in the terms. The exact design can, of course, then vary between the different lenders, but usually it is relatively the same.

Basic requirements


The basic requirements set by lenders are often divided into two different parts. These are personal requirements and then on safety.

Personal requirements

The lenders do not lend money to be kind, but they do this to make money, which is pretty obvious. Therefore, they set certain requirements that a borrower must meet in order for them to consider lending money. First, anyone who wants to take out a mortgage must be of legal age. This is a requirement that always applies to all types of loans. Furthermore, one should normally be a Swedish citizen and have an income that is considered sufficient.

What is a sufficiently large income cannot be said in advance as it is very much about how much the housing costs. They say for themselves that a person who wants to borrow USD 3 million needs to have a higher income than someone who wants to borrow USD 500,000.

Most often, a potential lender may not have any active payment notes. However, this is something you can get around when it comes to mortgages. On the one hand, there are lenders that target people with slightly worse finances, and then it is also possible to borrow from the big banks. Then it really is important to have a good economy so that they feel secure. Then it should be said that even with those who target people with poorer finances, there is no guarantee that an application will be approved without a credit check, as always be done.

Safety requirements

The property that is purchased must be used as collateral for the mortgage loan, which means that the lender is entitled to this. For example, the home must be worthy enough for them to agree to have it as collateral for the loan. Furthermore, demands can be made on the condition of the dwelling itself, etc.

Mortgage repayment


A loan must always be repaid, even though it often happens for a very long time when it comes to mortgages. It is not uncommon for a mortgage loan to be repaid in 50 – 60 years. However, in order to get such a long repayment period, the borrower must be quite young. Sometimes the lenders can also agree that the borrower does not repay anything at all on the loan. This gives even lower monthly costs, but at the same time the loan becomes totally more expensive.

Divide the loan

Although a mortgage is a loan, it can be divided into several different parts. And then we are not talking about top and bottom loans. Without the mortgage, which is the part of the loan for which the home is collateral can also be divided. It is possible to divide the loan in principle as you would with different lengths of bonding times.

Interest rates

Interest rates

How high the interest rate on a loan becomes depends on the market situation at the moment and then how one chooses when it comes to bonding times. In general, it can be said that longer bonding time means higher interest rates than a short bonding time. However, this is generally why it can sometimes be cheaper with longer maturities. Otherwise, the great advantage of long maturity is that it is safer as the interest rate will not change regardless of what happens during the term of the bond. While mobile then more likely to be cheaper.


Before you sign any loan paper, it is important to know exactly what applies with different fees. For example, there may be setup fees for a loan (often negotiable) or other fees. Furthermore, one should keep track of what happens if a refund is delayed. Not because something like this is planned, but it is good to be prepared anyway.

Borrow for cash on house purchase

How should you deal with all these uncertainties that surround a house purchase? How can you know in advance that you will get the amounts required from you? Of course you cannot, but there are solutions that you may be able to use to make sure you get the deal in port. One of these solutions is to take a private loan.

Private loans for house purchases


A private loan is normally used to finance consumption. It can be anything. It can be travel, clothes, boats, beauty, small sums and more. When you say consumption, you don’t think about home buying. This is because a house purchase is only consumption in a really long perspective and only if you do not upgrade the house. If you fail to maintain the house you will eventually have consumed it and the house must be demolished or it has collapsed by itself. However, we do not act like this and therefore it is tricky to find out how to consume a house. Therefore, we usually classify a house as real estate and not consumption.

We do not normally take private loans for real estate purchases. But we do not take cheap loans to buy real estate here because the house will not constitute collateral for the loan. We have a private loan to compensate for our lack of savings capital. Simply put, we take the private loan to be able to buy the house we want and that’s it.

How does a private loan work?

How does a private loan work?

A private loan is just as it does a private loan. You can take out a private loan of just a few thousand dollars all the way up to over half a million. What you need to be able to take out a private loan is a fixed income, you must not have too large existing debts and normally you should not have too large existing debts.

When applying for a private loan, you must provide your name, address, telephone number, e-mail, social security number and your bank account number. You should also fill in the amount you are interested in borrowing and the amount of time you want the loan. What happens next is that the bank or credit institution makes a credit report on you. The credit information is made immediately by a computer and it is also the computer that makes the decision whether or not to get the loan. You will therefore be notified immediately if you get your loan or not. If you receive a positive message, the money will then be paid to your bank account immediately after you have received the loan.

Interest on private loans

The interest rate on private loans is divided into two parts. It is the nominal interest rate and the effective interest rate.

The nominal interest rate is set by the Good Finance Bank based on the assessments of the world economy that the bank makes. It is the Good Finance Bank’s assessment of Sweden’s economic outlook that makes how much interest you are paid. Good prospects often give a higher interest rate and poorer prospects give a lower interest rate. The nominal interest rate is really nothing more than a price of money. You will have to pay the nominal interest rate each month for the duration of the loan.

Before we talk about the second interest rate, the effective interest rate, let us briefly talk about the charges that come on private loans. These so-called administrative fees are actually most yet another way for the lender to make money. The administrative fees are mostly charged for things like newspapers and more, which are really entirely and kept by computers. But that you will still have to pay administrative fees is absolutely certain. These fees are often the same no matter how much you borrowed, which means that the fees portion of your total costs is quite high when you borrow less amount.

The nominal interest rates and the administrative fees together are the total cost you will have for your loan. This cost is called the effective interest rate. This is the effective interest rate you should use to compare different loans with each other when choosing credit institutions.

Mortgages on private loans

Mortgages on private loans

When you take out a private loan, you do it over a certain period of time. This means that you have a certain number of months or years to repay the loan. Thus, the entire loan should be divided into the total number of months you borrow. The amount you receive then is your monthly repayment.

Previously, it was common for loans to be amortization free. This situation has changed now that the Good Finance Bank has tightened the financial market in Sweden. The authorities are very afraid that the Swedes will be overpaid, so they have introduced stricter repayment requirements. So now you will definitely be able to pay off your loan completely during the time you took out the loan.