Interest, Mortgages | Accusing major banks of interest rate fraud:

Homeowners believe that the major banks are not as competitive as they claim.

Banks were as expected Set interest rates quickly Against customers after Norges Bank on Thursday last week Increase the key policy rate to 0.25 per cent.

But Huseierne’s director of consumer affairs and communications Carsten Bell is reacting to the fact that major banks such as DNB and Danske Bank write in their press releases that they have competitive interest rates after increases.

– Both statements are completely wrong! The September homeowner interest rate metric shows that DNB and Danske Bank’s published interest rates are not competitive, Pihl tells Nettavisen Økonomi.

Less than 1.50 percent

The best interest rates in this interest rate scale are below 1.50 percent. There are also banks with interest rates around 1.80 percent, which have chosen not to raise rates.

Returning to clients whose interest rates are between 2.40 and 2.50 percentage points, 0.60 percentage points above the best interest rate after the rate increase, is neither “competitive” nor “too low,” Behl charges.

He checked the price list of the two major banks in Finansportalen.no After the interest rate increase. For DNB, there is now an effective interest rate of 2.39 percent for the loan. Homeowners measure NOK 2 million up to 75 percent of the home’s appraised value.

All numbers in the homeowner’s interest rate scale are based on such a loan and actual interest rates. This means that the interest rate takes into account the fees and the number of installments per year.

non-competitive

– The nominal interest rate before the increase was 2.04 percent and is now 2.29 percent. Danske Bank has registered and taken 2.50 per cent of the loans we measure.

Our view is that these banks were not competitive before the rate hike, and now at least they are not. Behl claims that they deceive customers.

Neither DNB nor Danske Bank mentioned in the press release how good the best mortgage rate after the increase was. But what is mentioned as the best interest rate in a press release is often an interest rate that most people don’t get.

Oftentimes these interest rates apply to loans to young borrowers and so-called green mortgages, Biehl says, but they are not strictly speaking regular mortgages.

less than 2 percent

– What do you think of the rent of a good floating housing after the increases?

The effective interest rate is likely to be less than 2 percent, but at least around 2 percent. Other banks that do not raise interest rates are now offering about 1.8 per cent. If you get an interest rate of more than 2 percent and you contact the bank, there will be room to negotiate with active clients, Behl answers.

Alexander Dahl, director of retail market at Danske Bank, says of the criticism that there are many and increasingly different types of mortgages in the Norwegian market in general.

We believe that over time we have been, and are competing in this area, something that our strong growth in recent years clearly shows.

Individually

However, there will always be some degree of individual adaptation to the individual client situation. This means that bank price lists do not give a one hundred percent correct picture of competitiveness, says Dahl.

DNB Director of Communications Vibeki Hansen Lewin told Nettavisen that all of its customers have competitive rates, even after the latest rate adjustment.

– When we compare our prices to the market, we use publicly available information from Statistics Norway. Our clients can easily compare their bank mortgage rate online against Statistics Norway’s statistics, she said.

Almost all major banks raise interest rates by up to 0.25 percentage points on deposits and loans. They seem to behave the same way. It’s not surprising that banks did, Behl says.

Slavic

Banks often coarsely track the Norges Bank when interest rates are raised, but not when they are lowered. The majority of borrowers get another 0.25 percentage point interest rate increase, but there are those who get individual terms.

A large bank like Handelsbanken does not work with a price list, but always says that there are individual conditions.

– There are quite a few clients where banks price risk individually, and there may be good reasons for that, Behl comments. But what homeowners want is that Norwegian banks, like Swedish banks, should report the average interest paid in recent months.

– This interest rate is often lower than the official market rate, so you, the customer, know what the negotiating room is. Over the past six years, it has provided Swedish loan clients with good information, and it has been a good idea to introduce such a practice in Norway as well, says Biehl.

Also read: Norges Bank expects a big jump in home interest rates: Save several thousand on fixed rate metrics

1.6-1.7 percent

The most favorable interest rate terms are given to clients who have large member organizations behind them, with younger members getting the best interest rates. For example, Akademikerne has a huge agreement with Danske Bank.

The conditions that the academics will have will still be good, that’s clear. Behl says member customers get another 1.6-1.7 per cent interest rate.

He says Danske Bank has not yet made any changes to academics, so their offer is still 1.33 per cent lower in effective interest rates. Danske Bank did not say anything about the academics in the press release.

– But other Danske Bank customers will not get competitive terms. Pihl says the terms posted by DNB are not good, but there are a handful of DNB clients who get better than that.

vision requires

DNB did not choose to publish the price list for the Saga benefits program, and Pihl was unable to find out how many were included in the program. The only thing DNB mentions on the website is that Saga customers have additional favorable terms.

– DNB should clarify the terms in the Saga benefits program, but a year and a half ago they removed this program from Finansportalen. There is an information gap that gives DNB an advantage, because the price list out there doesn’t show good conditions at all.

Nordea, on the other hand, has its own lists of premium clients, and according to Bell, it has been in the top 15 lists on the interest rate scale for homeowners for some time. DNB did not want to comment on why Saga’s customer terms were not posted on Finansportalen.no

employee terms

According to Sindre Noss at Rentaradar.no, they don’t know which DNB users are Saga customers. But the distribution of interest rates to DNB clients since June 1, 2020 shows that almost no DNB clients have nominal interest rates below 1.40 percent. These are mainly those with employee terms.

23 percent of DNB users have a nominal interest rate between 1.40 percent and 1.49 percent.

– These may be Saga customers and perhaps others who have bargained heavily with DNB. Here, there are also many nurses who have mortgages by agreement with the Norwegian Nurses Association. The offer rate for nurses is 1.40 percent for a regular loan and 1.49 percent for a framework loan, respectively, says Noss.