Buying a Home

All bids, bid increases, acceptances and rejections are made in writing. The various estate agents now offer electronic solutions for submission of bids on their property listings. Alternatively, you can send the bid form to the broker by fax, MMS or scanned by email.

The first bid must always be submitted by 12:00 the day after the property viewing, after which the deadlines may become progressively shorter. It can be nerve-wracking, so remember your maximum limit!

PS! Do not show the financing certificate to the broker; instead, ask the broker to call us for confirmation of financing.

A shareholder's flat is very similar to a flat in a housing cooperative. However, instead of buying a share in a housing cooperative, you purchase a share with a leasehold right to a specific flat. The flat is owned by a private limited company, which operates much like a housing cooperative. You become a co-owner and shareholder in the housing company and gain decision-making rights alongside the other shareholders. As a rule, the share with the associated leasehold right to the flat can be sold freely at market price. Joint debt may be attached to a shareholder's flat (see also: Joint debt).

A flat in a housing cooperative is the same as a housing cooperative flat. This means that a housing cooperative owns the flat, but you have the right to occupy it and can sell your share. The housing cooperative often has joint debt, of which you also take on a share. You repay this debt through the service charges. Other joint expenses may be added, such as municipal charges, satellite/cable TV, and similar costs. Therefore, cooperative flats often have higher service charges than owner-occupied flats (see owner-occupied property below).

An annuity loan means that you pay the loan in equal monthly instalments until the loan is fully repaid. In the beginning, the repayment portion is small, while the interest portion is large. Over time, the repayment portion increases and the interest portion decreases. Because you pay the same amount each month, an annuity loan makes it easier to manage your finances. If the interest rate changes, the monthly amount also changes, but this applies to all loans unless you fix the interest rate.

Borrowing costs normally consist of repayments and interest rates. You can agree with the bank not to pay repayments for an agreed period.

On paper, it is the housing cooperative that owns the flat, whilst you rent the flat from the housing cooperative. Your share of the joint debt is paid through the rent, which usually also covers shared expenses. The flat's value is what you pay for the flat, plus your share of the joint debt.

External measurements, total area including storage rooms and garage.

A bid is a binding offer to purchase a property. All bids, bid increases, acceptances and rejections must be made in writing. The various estate agents now offer electronic solutions for submission of bids on their property listings. Alternatively, you can send a bid form to the broker by fax, MMS or scanned by email.

When you rent a property, it is common to pay a deposit into an escrow account to cover damage caused during the tenancy or non-payment of rent. The interest on the account belongs to the tenant.

Stamp duty is a tax payable to the state treasury when registering certain documents, for example when registering a deed for real property. A transfer tax of 2.5% of the purchase price must be paid when buying a freehold property. This does not apply to housing cooperatives or share-based apartments.

The effective interest rate shows the total cost of the loan, as it also includes costs and fees.

When you sell a property, you are liable for five years after the sale for significant hidden defects in the property. This liability is strict, meaning you are liable even if you are not at fault for the defects. Change of ownership insurance is a liability insurance you can purchase to protect yourself against such claims. Change of ownership insurance is arranged through estate agents and solicitors.

You can agree to a fixed interest rate on your home loan for a period. You can fix the loan interest rate for three years, five years or ten years, on part of the loan or the whole amount, depending on the type of loan you have. If you fix the interest rate on your loan, it means you have a fixed, agreed rate that remains the same regardless of how the variable rate in the market fluctuates.

Joint debt is debt that belongs to a housing cooperative, and everyone who has a housing right or share in a flat in the housing cooperative also owns a portion of the debt. The debt is often taken out to pay for work in the housing cooperative that benefits all the flats or residents in the housing cooperative, for example bathroom refurbishment, window replacement, facade renovation or balcony construction.

You repay the joint debt monthly together with the service charges. High joint debt means high rent. NB! Joint debt counts as your debt and affects how much you can borrow from the bank.

A plot of land you lease on a long-term contract from a landowner. May result in increased costs in the future.

Also called loan confirmation. If you need to buy a property, for example, the estate agent will want to be sure that you have your financing in order. The pre-qualification letter is a statement from the bank confirming that you can borrow up to a given amount.

If you have a loan with a variable interest rate, it means that the interest rate changes as the price of money (the money market) fluctuates. If the market interest rate changes, the interest rate on your loan will normally be affected by this.

When the interest rate goes up or down, you are entitled to at least six weeks' notice before the change takes effect.

Our loan for your first home is called Ung (Young Adults) mortgage at DNB. You can also get an Ung (Young Adults) mortgage when you need to borrow for your second or fifth home until you turn 34, with favourable terms on loans up to 90% loan-to-value.

Mortgages, tenancy agreements, housing cooperative shares or other obligations that are registered on the property.

The repayment period for a loan, typically between 20 and 30 years for mortgages.

If you have bought a new home that you will take possession of before you have sold your current home, you will need a bridging loan. Typically, the bridging loan is interest-only until your current home is sold and the old loan is repaid.

A municipal document that specifies the exact measurements of the plot. Check both the gross area (total area) and net area (where areas that cannot be used for building purposes have been deducted, e.g. roads).

The nominal interest rate is the interest rate that forms the basis for a loan and determines your instalment amount. It does not include other costs associated with the loan, such as fees.

A home equity credit line (HELOC) is a mortgage where you can borrow up to 60% of your property's value. Within this limit, you control how the funds are used, and you transfer the money yourself from the loan to your account in the online bank. You only pay interest on the portion of the limit you have used, and there is no cost to transfer from the loan. A home equity credit line (HELOC) is best suited when you have owned a property for some time and have your finances in order.

A secured guarantee can be an alternative to cover a shortfall in equity when taking out a loan. As a Mortgage guarantor, you pledge your own property as security for someone else's loan. This means that the bank holds you responsible for repaying the debt if the person you have guaranteed for does not pay. It is important to think carefully before agreeing to act as a guarantor for someone. Also consider how much you are willing to guarantee for – you can set a limit.

To refinance means to increase the loan you already have today. You may have several small loans that you wish to consolidate into your home loan, or perhaps you would like to ask the bank if it is possible to increase the loan amount because you are planning to buy a car or extend your house. If you need to refinance, you may require a valuation of your property.

The estate agent's description of the property must provide relevant information about the property and its condition.

When you buy a freehold property, you have full ownership of the property, and you can let it out without needing permission from a board. In other words, without having to ask anyone for permission. When you buy a freehold property, there is no right of pre-emption. Stamp duty is payable on the purchase of a freehold property.

A serial loan is a loan where the amount you pay down on the loan, that is the principal repayment, is the same each month. However, because the loan decreases, the interest portion will become lower each month. With a serial loan, you therefore pay more at the beginning of the loan period and less over time.