Can I get a Norwegian mortgage without permanent residency?
If you're not a permanent resident in Norway, you might be worried about your prospects of securing a mortgage in the country. Don't fret. The Local has the info you need to navigate the process.
Once they've moved to Norway and secured a job, it's common for international citizens to start looking at getting onto the property ladder.
However, many people start their new life in Norway by obtaining a temporary residence permit, rather than a permanent one.
READ MORE: How to apply for a Norwegian residency permit
Is it possible to get a Norwegian mortgage without being a permanent resident?
Norway's banking and financial institutions have very strict regulations designed to maintain the stability of the country's housing market and ensure that borrowers can repay their loans.
Typically, banks in Norway prefer lending to individuals who have some form of residency status.
READ MORE: Why it has become harder to get a loan or mortgage in Norway
That means you will be free to apply for a mortgage as long as you have a residence permit. This doesn't need to be a permanent residence permit.
Banks would prefer to offer a mortgage to a permanent resident. This preference is due to the perceived lower risk of lending to someone more likely to remain in the country.
However, this doesn't imply an outright denial of mortgages to non-permanent residents.
The usual mortgage requirements
Regardless of your individual circumstances, there are four typical requirements that you'll likely need to meet in order to get a mortgage in Norway.
To start off, you'll be required to provide the lender with proof of identity (such as a passport, ID card, or driver's license).
After that, you can also expect lenders to request proof of income to assess whether your income can withstand mortgage payments over a set period (employment contracts, tax returns, and pay slips are all fit for this purpose).
Major lenders in Norway will usually also run a credit score check (of which you will be notified via mail and/or SMS). The result of the credit score check will affect your chances of getting better mortgage terms.
READ MORE: How to build up a good credit score in Norway
Lastly, know that Norwegian banks tend to have different down payment requirements, but you can usually expect to pay between 10 and 20 percent of the total property price as a down payment.
Along with these requirements, some lenders have other criteria in place before offering mortgages, so double-check the rules that apply.
What international citizens should expect
First, while some banks have different mortgage conditions in place for international citizens, as a general rule, Norwegian lending regulations do not discriminate between mortgage applicants based on nationality.
The Local's outreach to some of the biggest banks in the country in May of 2023 – DNB, Sbanken, SpareBank 1 Østlandet, and Danske Bank Norway – showed that only DNB seemed to have special mortgage requirements in place for international citizens.
At the time, DNB, the country's largest bank, told The Local that it requires higher deposits from foreign residents (likely to offset the perceived increased risk).
"We offer mortgages to foreign nationals based on individual assessment. We usually require 25 percent equity, which is 10 percent higher than we require from Norwegian citizens," Lukas Loeb at DNB said.
The other banks did accentuate, however, that the rules for all applicants require them to have a Norwegian birth and social security number, which can take some time to get as a foreign citizen.
Furthermore, as part of the credit assessment and to be eligible for a mortgage, you'll generally need to have a loan-to-value ratio of less than 85 percent of the property's value, a maximum loan of five times gross income, and your disposable income must be able to withstand all relevant costs, as well as a three percentage points-mortgage rate increase.
So, while securing a mortgage in Norway without permanent residency presents some challenges, it's not impossible.
It does require a thorough understanding of the banking system, the mortgage market, and a solid financial foundation in the country.
But with careful planning, the dream of owning a home in Norway doesn't have to be outside of reach – even for non-permanent residents.
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Once they've moved to Norway and secured a job, it's common for international citizens to start looking at getting onto the property ladder.
However, many people start their new life in Norway by obtaining a temporary residence permit, rather than a permanent one.
READ MORE: How to apply for a Norwegian residency permit
Is it possible to get a Norwegian mortgage without being a permanent resident?
Norway's banking and financial institutions have very strict regulations designed to maintain the stability of the country's housing market and ensure that borrowers can repay their loans.
Typically, banks in Norway prefer lending to individuals who have some form of residency status.
READ MORE: Why it has become harder to get a loan or mortgage in Norway
That means you will be free to apply for a mortgage as long as you have a residence permit. This doesn't need to be a permanent residence permit.
Banks would prefer to offer a mortgage to a permanent resident. This preference is due to the perceived lower risk of lending to someone more likely to remain in the country.
However, this doesn't imply an outright denial of mortgages to non-permanent residents.
The usual mortgage requirements
Regardless of your individual circumstances, there are four typical requirements that you'll likely need to meet in order to get a mortgage in Norway.
To start off, you'll be required to provide the lender with proof of identity (such as a passport, ID card, or driver's license).
After that, you can also expect lenders to request proof of income to assess whether your income can withstand mortgage payments over a set period (employment contracts, tax returns, and pay slips are all fit for this purpose).
Major lenders in Norway will usually also run a credit score check (of which you will be notified via mail and/or SMS). The result of the credit score check will affect your chances of getting better mortgage terms.
READ MORE: How to build up a good credit score in Norway
Lastly, know that Norwegian banks tend to have different down payment requirements, but you can usually expect to pay between 10 and 20 percent of the total property price as a down payment.
Along with these requirements, some lenders have other criteria in place before offering mortgages, so double-check the rules that apply.
What international citizens should expect
First, while some banks have different mortgage conditions in place for international citizens, as a general rule, Norwegian lending regulations do not discriminate between mortgage applicants based on nationality.
The Local's outreach to some of the biggest banks in the country in May of 2023 – DNB, Sbanken, SpareBank 1 Østlandet, and Danske Bank Norway – showed that only DNB seemed to have special mortgage requirements in place for international citizens.
At the time, DNB, the country's largest bank, told The Local that it requires higher deposits from foreign residents (likely to offset the perceived increased risk).
"We offer mortgages to foreign nationals based on individual assessment. We usually require 25 percent equity, which is 10 percent higher than we require from Norwegian citizens," Lukas Loeb at DNB said.
The other banks did accentuate, however, that the rules for all applicants require them to have a Norwegian birth and social security number, which can take some time to get as a foreign citizen.
Furthermore, as part of the credit assessment and to be eligible for a mortgage, you'll generally need to have a loan-to-value ratio of less than 85 percent of the property's value, a maximum loan of five times gross income, and your disposable income must be able to withstand all relevant costs, as well as a three percentage points-mortgage rate increase.
So, while securing a mortgage in Norway without permanent residency presents some challenges, it's not impossible.
It does require a thorough understanding of the banking system, the mortgage market, and a solid financial foundation in the country.
But with careful planning, the dream of owning a home in Norway doesn't have to be outside of reach – even for non-permanent residents.
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