How to finance home buying in Norway?

Av: Dato: English

Almost 80% of Norwegian families own their own home.  Or maybe we should say, their bank owns it. But most Norwegian do not worry about their debt ratio.  Maybe because we have a solid bank system and regulation regarding how big mortgage the bank can give people according to equity and monthly income.

In general, the bank requires 15% of the sales value in equity, you cannot have a mortgage that exceeds 5 times the family income.  And you have to be able to pay an increase in interest with 5%.  This is public regulations from the government that the banks have to follow.   This is difficult to fulfil for some first-time buyers.  Therefore 50% of them get help from their parents to meet the banks requirements.

What about foreigners or non-Norwegian citizens, will they be able to get a mortgage in Norway?

The answer is yes, on certain conditions.

Normally the bank will require 25% of the sales value as equity.
You have to have a Norwegian D-number or identification number. https://www.udi.no/en/word-definitions/d-number/

With a D-number you can apply for a bank account in Norway, which you will need.
But you are free to apply for a loan in different banks.

The banks requires that you are employed in Norway, or get your salary paid through a Norwegian bank account.  Income abroad is not sufficient.

Regarding your equity you probably have to transfer them to your Norwegian bank, or at least give a proof that you have the funds in your bank at home.
When you transfer money you have to give an account of the origin of the funds.  Due to money laundry regulations.

But there is a catch to it all, it is not straight forward to open a bank account in a Norwegian bank.
Read more about this in this article:
Is it possible to bid on a property in Norway without having an account with a Norwegian bank?

Much easier to buy a home, if you already have the cash 

If you don’t need a mortgage to buy a property you will get the D-number after the purchase, from the Norwegian Mapping Authority (property Register).  The money will go through a bank in Norway to the real estate agency, who will take care of the registration and send the D-number application.  In that process you have to give an account of the origin of the funds, due to money laundry regulations.

Please contact me if you have further questions on this issue.

Best regards
Boligdama – Trude Larsen

+47 950 37 330 – trude@boligdama.no

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