Changing your loan
You can change the terms of your loan. It is also possible to refinance an existing loan to another type of loan, depending on the individual's needs.
Indexed or non-indexed?
You can convert an indexed mortgage into a non-indexed one and vice versa by refinancing and subject to a credit check. You can also change over to a hybrid loan (indexed and non-indexed).
Non-indexed loan | Indexed loan |
Non-indexed loans always have a heavier initial payment burden than indexed loans. | Indexed loans can have a lighter payment burden at the beginning. |
Non-indexed loans pay off your mortgage at a quicker rate. | Unless the loan term is shortened, asset formation on indexed loans is slower than on non-indexed loans. |
The payment burden on non-indexed loans with variable interest rates can increase significantly when interest rates rise. | Indexation is like interest that is added to the principal of the loan. |
You can apply to convert your indexed mortgage into a non-indexed one and vice versa by clicking on the link below. We will subsequently contact you to arrange a time for you to sign the documents.
Refinancing
We lend up to 70% of the real estate valuation when you refinance.
Customers can refinance an additional loan into a basic loan with a more favourable interest rate, provided the mortgage is less than 70% of the real estate value.
Book an appointment to see what options are available and find out a property's total mortgage and real estate valuation.
The costs associated with the changes to your Terms and Conditions are in accordance with the Bank's price list at any given time.
Fixed interest rate
Non-indexed loan
The payment burden remains stable if a non-indexed mortgage is fixed for 3 or 5 years (with a term change).
- Non-indexed loans with a fixed interest rate guarantee a stable payment burden and predictability during the fixed interest rate period.
- The interest rate becomes variable once the fixed period ends in accordance with the Bank´s interest table. However, you can request a new fixed period of interest.
- The payment burden on loans with a variable interest rate may increase, decrease, or remain the same in accordance with changes and trends in interest rates at the bank.
- Fixed-rate mortgages charge a prepayment fee if the amount is paid during the fixed-rate period. You can pay an additional ISK 1 million towards your fixed-rate mortgage yearly without a fee.
The costs associated with the changes to your Terms and Conditions are in accordance with the Bank's price list at any given time. A credit check will be required if the change to your terms results in a 20% increase in your debt burden.
Please fill out the inquiry form below to request a change in payment methods. We will then reach out to you to set up a time for you to sign the documents.
Apply for payment method change.
Indexed loan
If you have an indexed loan with a variable interest rate and want to fix the interest rate, then you need to refinance.
- Indexed loans with a fixed interest rate guarantee a stable payment burden and predictability during the fixed interest rate period.
- Fixed interest rates on indexed loans are revised every 5 years. The interest rate becomes variable once the fixed period ends in accordance with the Bank´s interest table.
- The payment burden on loans with a variable interest rate may increase, decrease, or remain the same in accordance with changes and trends in interest rates at the bank.
- Fixed-rate mortgages charge a prepayment fee if the amount is paid during the fixed-rate period. You can pay an additional ISK 1 million towards your fixed-rate mortgage yearly without a fee.
The cost of refinancing is according to the bank's price list at any time.
Changing the loan period
You can both lengthen or shorten the loan repayment time on your mortgage by changing the Terms and Conditions of your loan. The maximum repayment period is 40 years unless you are a first-time buyer.
- A longer loan term reduces the payment burden and slows asset formation.
- A shorter loan term increases the payment burden and accelerates asset formation.
The costs associated with the changes to your Terms and Conditions are in accordance with the Bank's price list at any given time. A credit check will be required if the change to your terms results in a 20% increase in your debt burden.
Please fill out the inquiry form below to request a change to your loan period. We will then reach out to you to set up a time for you to sign the documents.
Change your payment method
Equal instalments or equal payments?
Loans have either equal payments or equal instalments. You can change your payment method by changing the Terms and Conditions of your loan.
- When a loan is paid in equal payments, roughly the same total amount is paid each month (however, indexed loans can be affected by inflation).
- Equal payments reduce the initial payment burden compared to equal instalments.
- When a loan is paid in equal instalments, the same amount is paid towards the principal each month (however, indexed loans can be affected by inflation).
- Loans paid with equal instalments have a higher payment burden at the beginning than when paying in equal instalments.
The costs associated with the changes to your Terms and Conditions are in accordance with the Bank's price list at any given time. A credit check will be required if the change to your terms results in a 20% increase in your debt burden.
Please fill out the inquiry form below to request a change in payment methods. We will then reach out to you to set up a time for you to sign the documents.
Interest rate roof
Our interest rate roof option offers our non-indexed customers a safety net when interest rates rise.
- You choose the interest rate roof yourself. The amount must be over 7.5% of the annual interest rate for a primary mortgage but 8% for a mortgage plus loan.
- If interest rises above the roof you requested, the interest due is changed to accommodate this. The outstanding interest (the difference between the interest charged according to the interest table and the interest rate roof you have requested) is added to the principal amount.
- The outstanding interest is paid during the remainder of the loan period, i.e. distributed payments.
- The interest rate roof suits those who want to secure even payments, despite any interest rise.
Please take a look at the more info on the interest rate roof.