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COMPARE: Which Swedish banks give mortgages to foreigners?

Some Swedish banks are more likely to decline mortgage applications to foreigners without a permanent residence permit in Sweden. We asked 16 mortgage providers what their rules are on loaning to immigrants - here are their responses.

COMPARE: Which Swedish banks give mortgages to foreigners?
Online bidding on an apartment. Photo: Tomas Oneborg/SvD/TT

Mortgages or bolån in Sweden can be granted directly by banks, such as Swedbank, Danske Bank or Handelsbanken, or given out by other mortgage providers that are then used by multiple banks. The loan agency Borgo, for instance, is behind the mortgages given out by ICA Banken, Ikano Bank, Söderberg & Partners, Sparbanken Syd and Ålandsbanken.

This means that in some cases the banks themselves do not decide who to lend to, hiring out their mortgage service to another company.

It is important to note that banks may still have requirements that applicants are resident in Sweden or can prove connection to the country in another way, such as by earning in Swedish kronor, so it may still be difficult for individuals without a Swedish personal number to take out a mortgage in Sweden unless they can prove that they currently work, study or live in the country, or plan to do so.

The Local contacted 16 Swedish mortgage providers to ask whether non-Swedish citizens and people without a permanent residence permit can take out a mortgage with them. Here are the responses.

Nordea

Nordea – Sweden’s largest bank according to the Swedish Bankers’ Association – has some of the least strict regulations among the banks we contacted for immigrants in Sweden. The bank told The Local that prospective home buyers in Sweden may, in some cases, be able to buy a property before they’ve even moved to the country.

“If you live in or are planning to move to Sweden, you can take out a mortgage to buy a property in Sweden without a Swedish personnummer or a residence permit,” press officer Hugo Laigar said.

“Nordea offer individual advice and a decision will be made in each case,” he added. “The best thing to do is to get in touch to talk about the possibility of you taking out a mortgage with Nordea”.

Do you have to be a Swedish citizen? No

Do you need permanent residency? No

Handelsbanken

Sweden’s second-largest bank, Handelsbanken, are also willing to lend to immigrants without permanent residency, Niklas Eklund, business development chief at Handelsbanken’s mortgage subsidiary, Statshypotek, told The Local.

“You don’t need to be a Swedish citizen or have permanent residency in Sweden to take out a loan with Handelsbanken,” he said, explaining that loans were based on “an individual assessment of your specific situation and your financial situation.”

Do you have to be a Swedish citizen? No

Do you need permanent residency? No

A falu-red cottage in the Swedish countryside. Photo: Henrik Holmberg/TT

SEB

SEB, Sweden’s third-largest bank, does not require Swedish citizenship or permanent residency, press officer Niklas Magnusson told The Local.

“You can also look at the New in Sweden | SEB page on our website for more information on how you can become an SEB customer as a non-Swedish citizen and which documents you’ll need,” he said.

Non-EU citizens will need to provide a copy of their Swedish residence permit – meaning this service is not available for non-EU citizens without a personal number.

There are currently no rules against EU citizens without a Swedish personal number joining the bank or taking out a mortgage with SEB, although applicants do need to provide proof of address in Sweden, so those wishing to buy a property before moving to the country may have issues.

Do you have to be a Swedish citizen? No

Do you need permanent residency? No

Swedbank

At Swedbank, “the short answer is no”, you don’t need to be a citizen or permanent resident of Sweden to take out a mortgage, press officer Ralf Bagner said.

“The longer answer,” he added, “is that the same customer information process applies, where the person taking out the mortgage must prove the origin of whichever funds they use to purchase the property, that they are over 18 years old, and must open an account and internet banking with us.”

It is possible to open an account with Swedbank without BankID or a Swedish personal number, although, according to their website, applicants must provide valid ID (foreign passports are accepted) as well as “some other document, such as a residency permit, work permit, extract from the Tax Agency or school attendance certificate”.

This means that it may be difficult to apply for a mortgage for a property in Sweden if you have not yet moved to the country, unless you already have your resident documents or work permit available.

Additionally for those planning on moving to Sweden, he said Swedbank placed “somewhat higher requirements on credit checks” on this group, “as we don’t have the same possibility to carry out a credit check on the applicant via UC [Sweden’s largest credit check agency], for example.”

“In addition to this, we always ask for references from the customers’ bank in the country where they are a resident,” Bagner said.

Do you have to be a Swedish citizen? No

Do you need permanent residency? No

Danske Bank

Although originally a Danish bank, Danske Bank is also active in Sweden, offering mortgages and banking services in the country.

According to communications officer Natalie Rudarp, it “is difficult to get a loan approved without a permanent residence permit and work permit”.

“In line with current guidelines, as a bank we need to be sure that the customer can repay the loan, which is difficult if the customer only has a temporary residence permit.”

However, applicants “don’t need to be Swedish citizens”, Rudarp said.

Do you have to be a Swedish citizen? No

Do you need permanent residency? Yes, perhaps also a work permit

Photo: Magnus Hjalmarson Neideman/SvD/TT

SBAB

Stare-owned SBAB Bank is one of Sweden’s most popular mortgage providers, which is understandable given its history: SBAB was originally set up in the 80s to handle the finances for state mortgages.

SBAB “do not have any requirement for citizenship but you must be registered in the Swedish population register,” press officer Erik Bukowski told The Local.

He said that lenders also needed to demonstrate “a stable income and no records of non-payment.”

Do you have to be a Swedish citizen? No

Do you need permanent residency? No

Borgo (ICA Banken, Ikano Bank, Söderberg & Partners, Sparbanken Syd och Ålandsbanken)

Borgo is a mortgage institute used by five Swedish banks: ICA Bank, Ikano Bank, Söderberg & Partners, Sparbanken Syd and Ålandsbanken.

Borgo confirmed to The Local in a phone conversation that those applying for mortgages with them do not need to be Swedish citizens, but do need to have a personal number and a permanent residence permit.

This means that mortgage applicants with these five banks must have permanent residency for their mortgages to be approved.

Do you have to be a Swedish citizen? No

Do you need permanent residency? Yes

Landshypotek Bank

Landshypotek Bank offer mortgages for houses or summer houses in Sweden (not bostadsrättsföreningar, so apartments and most terraced houses are not eligible).

According to press officer Jonas Feinberg, Landshypotek offers mortgages to those who are “over 18 and registered in the Swedish population register, have income in Swedish kronor and have a private property (such as a detached house or summer house) which can be used as security for the loan”.

“When you apply for a mortgage, we carry out the usual credit check. If you, or the person you apply with, has a record of non-payment, we will not be able to approve your application,” Feinberg added.

Do you have to be a Swedish citizen? No

Do you need permanent residency? No

Photo: Fredrik Persson/TT/

Skandia

Skandia Bank “does not have any requirements for Swedish citizenship or permanent residency,” press officer Jonatan Ohlin told The Local.

According to its website, applicants must be “over 18 years old and registered in the Swedish population register.”

“You also need a guaranteed base salary from a permanent position, lifelong pension or declared income from self-employment. We do not count incomes such as bonuses, commission or supplements received for working evenings or weekends which are not guaranteed.”

Do you have to be a Swedish citizen? No

Do you need permanent residency? No

Hypoteket

Hypoteket is not a bank, rather a bostadskreditinstitut, literally a “property credit institute”, meaning it only offers mortgages and no other banking services.

At Hypoteket, prospective mortgage applicants need “BankID and therefore also a Swedish personal number,” CMO Patrik Fjelkegård told The Local.

“You also need your income to be in Swedish kronor”.

“When you apply, we take an automatic UC credit check. There, we get an overview, and if there are any issues we may need more information like a certificate from your employer, payslips, or an estate agents’ valuation, for example.”

Do you have to be a Swedish citizen? No

Do you need permanent residency? No

Länsförsäkringar

Länsförsäkringar offers private banking and mortgages in Sweden. According to communications officer Ola Kallemur, Länsförsäkringar has “no requirement for Swedish citizenship or permanent residency in order to take out a mortgage”.

Do you have to be a Swedish citizen? No

Do you need permanent residency? No

Stabelo

Stabelo, a digital mortgage provider, had not yet responded to our emails at the time of publication, but we will update this article as soon as we receive a response.

 

Vocabulary

Tillsvidareanställning - permanent position of employment

Betalningsanmärkning - record of non-payment

OB-tillägg - supplementary pay due to working outside of normal working hours

Kreditgivare - loan provider

Bolån (occasionally hypotekslån) - mortgage

Folkbokförd - registered in the Swedish population register

Arbetsgivarintyg - employer certificate (a certificate provided by your employer detailing your position, salary and how long you have worked in that role)

Lönespecifikationer - payslips

This information was correct as of August 2022. This is not financial advice, and we strongly encourage those considering taking out a mortgage in Sweden to do their own research before approaching a mortgage provider for a loan.

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PROPERTY

These are our readers’ top tips for buying a property in Sweden

Buying an apartment or house in Sweden can be a daunting process, but with rentals so hard to get, many foreigners end up taking the plunge. Here are the top tips from readers who have done it.

These are our readers' top tips for buying a property in Sweden

Get prepared! 

Most of the respondents to our survey stressed the importance of preparation. 

“Spend time on defining your requirements properly, including visits to different locations to narrow down your search,” advised Julian, a Brit living in Malmö. 

As well as working out your requirements, other participants argued, you should also get to grips with the way the bidding system works in Sweden, with one British woman recommending buyers “speak to professionals about the buying procedure”. One respondent went so far as to recommend hiring a buyers’ agent, something international employers sometimes provide for senior executives moving to Sweden. 

Elizabeth, a 26-year-old charity worker from South America, recommended that all buyers “learn to read a bostadsrättsförening årsredovisning”, the finance report for a cooperative housing block. (You can find The Local’s guide here.) 

Get to know the market 

Maja, an anthropologist from Hungary, said it was important to take time to get a feel for the market, suggesting buyers visit different areas to find the one that they like. 

“It will take 6-12 months easily,” she predicts. “Don’t rush. Visit the neighborhoods where you are thinking of buying.”
 
Others recommended spending time surfing Sweden’s two main housing websites, Hemnet and Booli, to get a better feel for how much different types of housing in different areas typically sell for, before starting to look seriously yourself, with one even recommending going to viewings before you have any intention of buying.  
 
“Start visiting houses and monitoring bids. That will give you a sense of the process,” recommends Shubham, 31, a software engineer from India.
 

 
Think about your expectations
 
While house prices have soared in Sweden’s cities over the past decade, the same is not the case in all rural areas, something some respondents thought buyers should take advantage of. “To buy a house at a lesser price, look at areas as far from urban areas as is possible for you and your family,” wrote Simon, a 61-year-old living in rural Sweden. 
 
Julian warned bidders against areas and types of homes that “will attract tens of ‘barnfamiljer’ (families with children), meaning “bidding wars will result”, pushing up the price. 
 
On the other hand, one respondent warned people to “avoid buying apartments in vulnerable areas, even though prices will be lower there”. 
 
An Italian buyer recommended looking at newly built apartments coming up for sale. 
 
 
Get a mortgage offer before your first serious viewing 
 
Getting a lånelöfte, literally “loan promise”, can be tricky for foreigners in Sweden, as our recent survey of banks’ policies showed. 
 
Shubham warned against applying for a loan promise from multiple banks, arguing that this can affect your credit rating if your finances are not otherwise good. He suggested using an umbrella site like Ordna Bolån and Lånekoll, although he warned that the payment they take from the ultimate mortgage provider might ultimately be taken from borrowers.  
 
READ ALSO: 
 
Get to know the estate agents, but don’t necessarily trust them 
 
Gaurav, a sales manager based in Stockholm, recommended getting to know local estate agents in the area where you are planning to buy, as they might be able to direct you towards owners who are in a hurry to sell. “Those can be the best deals as you have greater chances to avoid bidding on such properties,” he argued. 
 
Maja, from Hungary, warned, however, against believing that the estate agent is on the buyer’s side. 
 
“You cannot really make friends with them, they work for commission and they will also try to raise the selling price,” she said. “It’s how they present you to the seller that matters. Seem like a serious buyer.” 

 
Should you try to make an offer before bidding starts? 
 
Morgan, a 33-year-old marketing manager from France, said it was worth studying the kommande (coming soon) section on Hemnet and Booli to spot houses and flats before they are formally put on the market. “Be alert. Book an appointment asap and get a private visit to reduce competition. If the apartment is what you’re looking for, make a reasonable offer with a condition to sign the contract in the next 24 hours,” he recommends. “You will cut the bidding frenzy and save money.”
 
Gaurav also recommended getting a private viewing and making an offer while the property was still off the market, as did Julian. 
 
“If you are lucky, you might find owners who are in a hurry to sell,” Julian said. “Those can be the best deals as you have greater chances to avoid bidding on such properties.” 
 
But other foreigners warned against bidding before a property is publicly put up for sale on housing websites, arguing that estate agents used this as a way of getting higher prices than they would expect to get at auction.  
 
“You are essentially negotiating directly with the owner, without finding out the actual market price via bidding,” argued a 31-year-old Indian business analyst. “Usually this will work only for an apartment not in top condition.” 
 
What to watch out for in the bidding process 
 
Morgan advised buyers to take what estate agents say about rival bidders with a pinch of salt. 
 
“Estate agents will play the competition card. Don’t fall for their trick and keep a cool head. Ask yourself if it really worth it before increasing a bid,” he wrote. 
 
In Sweden, it is possible to make a hidden bid, which is not disclosed to other bidders. One Indian software developer warned that estate agents would often claim that there was such a bid to pressure you. 
 
“The hidden bids are really confusing as you don’t know the bid placed,” he said. “It’s a trap to get higher bids. “
 
A 21-year-old Romanian agreed it was important to watch out for estate agents who try to rush or panic you. 
 
“[Look out for] those that try to rush you into it by saying stuff like ‘this will be gone by Monday, the owner wants to sell fast’, or if they don’t want to include a two-week period to have the property inspected as a clause in the contract,” she said. 
 
Maja recommended choosing an estate agency that required all bidders to supply their personal number, with all bids made public, “because other agencies might cheat that price rise”. 
 
“Don’t be the first bidder,” she added. “Keep your cool, and if the agent calls or messages, just hold on. There is no official end to the bidding. Only when you sign the contract. So the best game is to seem very serious but not stupid. You have a budget, and try to sign the contract the same day or the next if you are the highest bidder.” 
 
Is now a good time to buy? 
 
The respondents were, predictably, divided. 
 
“It’s risky for both sellers and buyers,” said Carl, a Swede who recently returned home from China. “The market seems to correlate pretty well with central banks raising interest rates. If that’s the case, then it’s still a sellers’ market since central bank [Riksbank] will continue to increase interest rates until 2024.” 
 
“It’s difficult to predict anything at the moment,” agreed Gaurav. “Prices should fall a bit but that’s not happening in all the areas. Avoid buying or selling if you can for a few months.” 
 
“I see there is no difference in buying in total cost. You can get a property at a lower price but end up paying more in interest and the price is the same in five to ten years,” said one Indian software engineer. “Buying is still better than renting.”

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