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How easy is it to get a mortgage in Norway as a foreign resident? 

Ever wondered how straightforward it is for a foreigner to get a mortgage. Pictured is a typical Norwegian coastal house with a cruise ship sailing past in the background
Ever wondered how straightforward it is for a foreigner to get a mortgage. Pictured is a typical Norwegian coastal house with a cruise ship sailing past in the background. Photo by Vidar Nordli-Mathisen on Unsplash
Is getting a mortgage for foreign residents in Norway a breeze, or are there plenty of hoops to jump through? Here's what you need to know. 

The first step towards buying a home in Norway begins with a mortgage application, but how much red tape is there for foreign residents when it comes to securing a loan? 

One of the first things you’ll need to know is that there are no rules that prevent foreigners from owning or buying property in Norway, so you’re all set to begin the hunt for your dream home in that regard. 

You’ll be able to apply for a mortgage from most traditional banks in Norway. In addition, there is also the Norwegian State Housing Bank, Husbank, which provides grants for building new houses and renovating properties. 

Municipal startup loans are also an option for those struggling to get a mortgage from a typical bank. You can read more about municipal startup loans here. How municipal loans are granted will depend on the practices of the local authority in question. 

READ ALSO: Is it better to buy or rent property in Norway?

Once you’ve found your provider, it’s time to sit down with them and discuss the mortgage itself. 

If you want to read more about property in Norway, ranging from a guide to buying in Oslo to whether or not solar panels are worth investing in, click here

What paperwork will I need? 

The documents you need will vary, but generally, you’ll need your financial records, such as payslips, as proof of your income. In addition, the bank may ask for your tax records too. You will also need a Norwegian Identification Number, such as a D-number or Personummer. You will not be able to secure a mortgage or buy any property without the ID number. 

This could be one of the main stumbling blocks for foreign residents new to Norway. 

Another hurdle could be a lack of credit history in Norway if you have been in the country for less than a year, sometimes longer. The lack of credit history, which doesn’t carry over from the country you came from, could hold up the process or prevent you from getting a mortgage entirely. 

For those that have already lived in Norway for a while, getting a mortgage should be straightforward as banks will already have an identification number and credit history.

If you are applying for a loan with a Norwegian partner, then it may be possible to secure a housing loan without much credit history in Norway, but this will come at the cost of higher rates.

How much can I borrow

Generally speaking, you’ll be able to borrow either three times your annual income or up to 85 percent of the price of the property. Top-up loans are an option for those unable to put down 15 percent upfront. 

Furthermore, first-time buyers can apply for a special mortgage where you can borrow 100 percent of the purchase price, and the interest rate will be fixed for the duration of the mortgage. 

The repayment period in Norway is typically between 20 to 30 years. You can check out and compare mortgage providers here

It’s worth being aware that mortgage rates are rising in Norway after being set to zero throughout the pandemic. This means you should expect the interest rates to increase and the repayments to become more expensive for the first few years after taking out your mortgage. Therefore, you should try and factor the increasing repayment costs into your budget if you can. 

READ MORE: Norwegian lenders raise interest rates after central bank hike

Another thing worth highlighting is that you should receive the all-important official mortgage approval document once your application has been approved. You will need this to purchase a house in Norway.  

Vocab

  • Visninger- Viewing
  • Boligån- Mortgage
  • Nybygg- New build 
  • Eiendomspriser- Real estate prices
  • Budrunde- Bidding process
  • Selvangivelse – tax assessment
  • Bolig konto– house account
  • Gjennomsnittspris – average price

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