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The government’s decision to eliminate the “crown fee” is causing major banks to tighten mortgages. DNB-topp believes that control of the crisis should have been phased out.
MUST TIGHTEN: Endre Jo Reite, BN Bank’s director of retail sales, says that several mortgage applicants are now in a hurry.
Thor Nielsen
Published:
More people have to settle for mortgage denials after the government announced on Friday the abolition of the “crown fee” in mortgage regulations.
Big banks confirm to E24 that the removal of the rule will lead to a real tightening of loans.
– There are several mortgage applicants who are in a hurry now, because they know they are having a hard time, says Endre Jo Reite, director of retail sales at BN Bank.
The financing certificates that have been granted through the “crown fee” will remain in force, he assures.
– On the other hand, it is not certain that you will receive a renewed financing certificate that expires, says Reite.
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Double the exception quota
After the pandemic paralyzed Norway in March, banks were given the green light to double the proportion of mortgages in which applicants fail to meet normal equity and serviceability requirements – from 10% to 20% of the total loan .
– It was important to put banks in the best possible position to help loan clients during a demanding period, explains Finance Minister Jan Tore Sanner (H).
This exceptional help can be provided, for example, to mortgage applicants with strong income and secure finances, but who have not saved up to 15% of equity.
DNB, Nordea and BN Bank confirm that they have benefited from the widening of the room for maneuver and that, therefore, the cut in the quota by the government leads to a real tightening of mortgages for applicants who do not meet the requirements main.
It seems that the transition is too abrupt
The exception quota will be cut in half from 20 to 10 percent after the third quarter, the government decided.
Ingjerd Blekeli Spiten, leader of DNB, believes that the transition should have been smoother.
– It is important to remember that from the moment a financing certificate is issued, it can take up to three months before the house is bought and another three months before the money is paid to the seller, explains Blekeli Spiten, head of retail from the main bank.
– Therefore a good solution would have been to gradually reduce the flexibility quota. We register that the ministry does not want this, it continues.
The exception fee in the mortgage regulations is only a maximum limit. Just because it is reduced from 20 to 10 percent does not mean that the proportion of exceptional mortgages will be cut in half.
– It is a common mistake to think that banks reach the maximum limit. After the crown, most of us have dared to grant various loan applicants exemptions from the main requirements. But not twice as much, says Reite at BN Bank.
Nordea: It was well below 20 percent
He believes that very few banks will be comfortable deviating from the saved capital or servicing capacity requirements of 20 percent of their loans, even if they have been able to do so.
Nordea also says they haven’t come close to exceeding the “crown quota” of 20 percent.
– We have granted exceptions for more than 10 percent of loans recently, but we have had good authorization up to the time limit, communications director Christian Steffensen tells E24.
Although loan requirements are now becoming more rigid again, the Nordea summit notes that the financial situation has changed for many as well.
– In March and April, we had a violent influx of clients who experienced being laid off or unemployed on short notice and who needed help to overcome a difficult situation. We don’t see that anymore, although there are still many who are having a hard time, says Steffensen.
-That the government is tightening now, I think it will be very easy to handle, he says.
