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Six things to know before taking out a loan in Norway

Finding a loan can be time-consuming. Finding the right loan for you while living in Norway is even more difficult, especially with multiple banks competing for your interest.

Published: 9 April 2019 08:36 CEST
Six things to know before taking out a loan in Norway
Photo: bruce mars/Pexels

Here are some tips that you can bank on to help with the process.

1. Do your homework

Regardless of whatever reason you require a loan, be it refinancing existing loans, a new kitchen or a new car, investigate your own finances and draw up a (realistic) budget in terms of how much you can afford to repay each month if you take out a loan. Calculate your income and expenditure and, in particular, factor in any other loans you may have.

2. Use a loan broker

Chances are, you are bombarded with offers from banks all looking to throw money in your direction. But siphoning through all of them can be incredibly time consuming. Using a loan broker, such as DigiFinans, takes the hassle out of the loan search. DigiFinans handles your application and ensures the banks are competing for you instead of the other way around. Oh, and the service is free.

Click here to start your loan application with DigiFinans

3. Family matters

The bank of mum and dad has helped out many loan applicants in the past but it isn’t always open for business. Including a co-applicant — particularly if you are newish to living in Norway — will often increase your chances of getting a loan, which in turn will result in better terms and a lower interest rate. Your spouse, registered co-habitant and, in some cases, friends and your parents can also be a co-applicant.

4. Merge your loans together

One big loan is easier on your pocket than several small loans combined. Prior to making your new application, factor in the possibility to combine all your loans together, which will often result in a lower interest rate. The experts at DigiFinans can help you with your application and simplify your financial life.

5. Be thorough

Granted, you want the money and you want it now but your loan application will only stand a chance if you provide full and accurate information when you apply. Banks, of course, want to loan you money but not at any cost so ensure that your accounts are in order. If your loan application is approved, you can borrow up to 500,000 krone by using DigiFinans.

Start your loan application with DigiFinans now

6. Assess all offers

Before you book a flight or hotel, you probably use a price comparison website. The same logic applies when looking for a loan. The whole process is made considerably easier by using a service such as DigiFinans, which liaises with the banks directly. Minutes after filling in an application, you will get a flurry of messages with loan offers from various banks and loan providers. Then it is up to you to look at factors such as interest rate, monthly costs and bank fees to decide which offer suits you best. The team at DigiFinans follows up on finished applications once the loan has been processed.

Example loan: 65.000 kr. 5 år Kost 28.720 kr. Tot 93.720 kr.

This article was produced by The Local Creative Studio and sponsored by Salus.

 

 

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MONEY

How to protect your Norwegian savings when the stock market jitters

Despite a rebound on the Tokyo Stock Exchange on Tuesday, Monday's stock market fluctuations have left Norwegian consumers worried about their savings invested in the market.

Published: 6 August 2024 10:01 CEST
How to protect your Norwegian savings when the stock market jitters

On Monday, concerns about a potential recession in the US influenced financial markets across Asia and Europe.

The Oslo Stock Exchange (Oslo Børs) opened with a sharp fall on Monday morning. This downturn followed a stock market crash on the Tokyo Stock Exchange.

READ MORE: What the Norwegian krone’s fresh slump means for your finances

Similar declines were seen in other Scandinavian capitals, such as Copenhagen and Stockholm.

Wall Street mirrored this negative trend, with the Nasdaq technology index plunging over 6 percent at the opening.

By the end of the trading day, Nasdaq closed down 3.43 percent, the S&P 500 fell around 3 percent, and the Dow Jones ended down 2.6 percent.

Despite a notable rebound on the Tokyo Stock Exchange on Tuesday, with the Nikkei index rising more than 10 percent, the dramatic stock market fluctuations have left Norwegian consumers worried about their savings invested in the market.

Many were left wondering whether the developments called for action.

Important not to make rash decisions, expert says

Generally speaking, when you see alarming headlines about the stock market, most people shouldn’t do anything – they should sit down and calmly ride the wave out, Américo Fernández, a household economist at the Swedish SEB bank, told The Local on Monday.

“Of course, it’s always dramatic when we have such developments in the stock market in just one or two days,” he said, adding that people with savings in the stock market shouldn’t be that worried.

“I would say that this is how the stock market works: there’s a lot of uncertainty and risk connected.

“When you have savings on the global stock exchanges, this will happen, especially when we’ve had at least six months of really, really good returns – maybe even too good. Then, this is a little bit expected,” he said.

Advice for savers across Scandinavia

Fernández shared his advice for worried savers across the Scandinavian countries, noting that it’s understandable that stock market volatility can raise concerns about the safety of people’s savings.

For those wondering how to protect themselves against such crashes, he emphasised the best strategy is to take a consistent and steady approach to investing.

“The most common thing, the best strategy for the broad masses, is to save every month,” he said, adding that investing in a mutual fund is a great way to go about this.

“In circumstances such as these (note: when there’s a crash), you buy more at a lower price. So, instead of timing the stock market, which is almost impossible, continue your monthly investments through mutual funds. That’s a good way of diversifying your portfolio,” he said.

READ MORE: How much money do you need to live on a single income in Norway?

The SEB household economist also advised against reacting hastily to alarming headlines.

“It’s understandable that a lot of people are affected by herd mentality when we have these negative headlines. Everyone, but especially households with tiny savings, acts and sells, and then they buy again when the headlines are positive, when the stock exchange is at high levels…

“That is the opposite of what you should do. Try to neglect these things and be cool in these circumstances, even though it seems bad and hurts your wallet,” he noted.

This advice is relevant across Scandinavia, according to Fernández.

“I think it’s applicable across Scandinavia. All Nordic countries save a lot of money on the stock exchange, partially because the pension system isn’t fully funded by the government,” he said.

US financial developments and new stock market tumbles

Is this stock market fluctuation a rare event, or is there more volatility on the horizon?

In recent years, the US stock market had surged on the wings of strong technology optimism, chief economist Elisabeth Holvik at SpareBank 1 told the Norwegian Broadcasting Corporation (NRK) on Monday.

However, recent declines saw technology giants like Nvidia, Apple, and Tesla falling between 4 and 7 percent.

“Now, we see that the economy is slowing down. Industry is slowing down, and consumption is slowing down. One is afraid that the whole economy will slow down too quickly and that the central bank has fallen far behind when it comes to cutting interest rates.

“So, until you get the first interest rate cut, I think there will be great uncertainty and the risk of a further fall in the stock market,” Holvik said.

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