The matter in a nutshell Interest rate increases from Norges Bank – 16 per cent of those asked have not renegotiated their mortgage with their private bank The Consumer Council recommends negotiating the biggest expenses first Communications director at Finance Norway advises people to check which bank has the cheapest interest rate For young people who have high loans and high interest rate – show the bank that you are a responsible person with order in your finances The financial portal provides an overview of what interest rates are at all Norwegian banks The summary is made by an AI service from OpenAi. The content has been reviewed by news’s journalists before publication. – I think the increased interest rate is awkward. We wanted to buy a bigger house, but we have to put that on hold, because it is so unpredictable, says Oksana Åsli. news asked people on the street what they think about the interest rate increases, and what they do about it. – We have not negotiated with the bank, the impression is that the banks are so coordinated that we have rather cut back on after-school activities, leisure activities and other purchases, says Åsli. 1 in 4 do not negotiate Norges Bank raised the key interest rate to 3.75 per cent on Thursday last week. It is the highest in 15 years. On Monday, DNB confirmed that they are increasing mortgage interest rates by up to 0.5 percentage points. Two more interest rate hikes are also expected during 2023. If that happens, it will mean an average mortgage interest rate of 5.75 per cent. Policy rate in percent The policy rate is set eight times a year by Norges Bank. The policy interest rate governs the interest rates in the banks, and affects your housing costs. The aim of raising the interest rate is for the high prices to come down again. The forecast tells us how Norges Bank thinks interest rates will develop in the future. Read more about sources and reservations here. A higher policy rate means increased expenses if you have a mortgage 2021 2022 2023 2024 2025 2026 Forecast Norges bank You can feel it in your wallet. But a survey by the Consumer Council earlier this year shows that very few of us try to do anything about the rent. Most of us cut back on other things in the budget than contacting the bank, like Åsli. In 2022, 16 per cent of those asked said that they had not renegotiated their mortgage with their private bank. The switching survey, which is taken by the Consumer Council every year, shows that until March 2023, 23 per cent have not negotiated or switched banks. Interest calculator The calculator uses the formula for annuity loans to calculate your monthly costs. Nominal interest is used here. This means that there will be an additional transaction fee which will vary from bank to bank. Today’s interest rate is taken from DNB’s mortgage interest rate for young people, and different banks will have different interest rates. The figures given here will therefore be approximate for you. Monthly expenses are interest and repayments combined. Read more about sources and reservations here. See how much you have to pay if the interest rate increases. The loyal customer Back in Bodø, we meet Jørn-Gunnar Gundersen. He is the loyal customer who has had the same bank for many years, and who neither negotiates nor changes banks. – I notice that interest rates are rising, yes, but we will manage, he says. – Have you negotiated with your bank? – No, I don’t quite believe that. I am the loyal customer who pays and says nothing. Jørn-Gunnar Gundersen is the loyal bank customer. Photo: Lars-Bjørn Martinsen / news Jorge Jensen of the Consumer Council, tells news that here the customers are making a bit of a mistake, because it doesn’t pay to be loyal and neither are all the banks in sync. – The banks are not well coordinated. We have a cluster of challenger banks that provide competition in the market, says Jensen. He says that when they do surveys, the most common answer is that you are satisfied and feel you have the best. But there are a mix of explanations for why people don’t make a phone call to the bank. – Among other things, that you have no faith that they will get anywhere with it, says Jensen. Got to change Ida Vading is the next bodøværing news talked to on the street. She and her husband have chosen to both negotiate, but also change banks. They saved money on that. – I don’t think anything about the increased interest rates and we notice that the thousands are flying by. We have changed banks and negotiated the interest rate, we have to go where it gives us the most, she says. Jensen says that the Consumer Council recommends that people take the step to negotiate the biggest expenses first, such as loans, insurance and electricity. The next piece of advice is to look at the food budget. Ida Vading and her husband saved money by both negotiating and switching banks. Photo: Lars-Bjørn Martinsen / news – Start with the big expenses first, when that is done I would look at habits and other expenses such as subscriptions, he says. Bank manager at Sparebanken Nord-Norge in Bodø, Kristian Haubakk, tells news that they feel that many customers are aware of the economy, debt obligations and the interest they have to pay now that everything has become more expensive. – It is natural to have extra work in these times, he says. – But is there anything for the customers to do? – It is very different. Some have the right price, others have taken steps to, for example, increase the value of the house. Then there may be a bit to get. Bank manager at Sparebanken Nord-Norge Bodø. Photo: Sparebank 1 Nord-Norge Because it is the case that the price we get for loans is calculated based on the risk the bank has. If you are young, have a large loan on the house and are new to professional life, the bank will pay more for the risk they take. – I think it makes sense to have a good dialogue with your bank. We may be able to adjust the price if the value of the home has increased, he says. Get control of the economy But all in all, getting control of the general economy is the most important thing in times like this. – The most important tip I have now, where you are paid holiday money, is to get control of your finances and plan what the money will be used for. Then you are also better equipped beyond the autumn, says Haubakk. Director of Communications at Finans Norge, Jan Erik Fåne, says that it is not just price that people value. Equally important is a local connection and that the customers are satisfied with the adviser in the bank. – There are many people who are satisfied with the bank, but there is reason to believe that there are more people who are active in the market now that interest rates bite people’s wallets hard, he says to news. He recommends checking the Financial Portal. There you can find out what the interest rate is at all Norwegian banks. – There are over 100 banks in Norway that offer mortgages. Check who has the cheapest interest rate, obtain an offer, take it to your bank and try to negotiate there, says Fåne. Director of Communications at Finans Norge, Jan Erik Fåne, says it’s a good idea to call the bank. Photo: Erlend Aas / NTB scanpix And he encourages consumers to be active and critical. – It doesn’t get any better than what the consumers make it out to be. Competition requires that consumers use the power they have to get better competition in the market, adds Fåne. For young people who tend to have large loans and high interest rates, the advice is to show the bank that you are a responsible person with finances in order. – Pay the loan within the deadline, show that you are a safe and solid customer who is important to keep.
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Interest rate increases – how can you save money? – news Nordland
