New range of mort­gages from Arion Bank

Arion Bank is once again offering non indexed mortgages with variable interest rates. Customers now have three main options when taking out a new mortgage:

Non indexed mortgages with variable interest rates – loan term up to 40 years
Customers may take out a mortgage with non indexed variable interest rates.
The loan term may be up to 40 years. Mortgages with variable interest rates do not carry a prepayment fee.

Non indexed mortgages with fixed interest rates for three years – loan term up to 40 years
Customers may take out a mortgage with non indexed interest rates fixed for three years. The loan term may be up to 40 years. When the fixed rate period ends, the loan switches to the Bank’s variable rate available at that time. A prepayment fee applies during the fixed rate period, but once the loan shifts to a variable rate, no prepayment fee applies.

Indexed mortgage with fixed interest rates for three years at a time – loan term up to 30 years
Customers may take out a mortgage with indexed fixed interest rates for three year periods. The loan term may be up to 30 years. At the end of each three year period, the Bank may review and refix the interest rate for the next three years. During the last 90 days of each fixed rate period, the loan carries no prepayment fee.

Learn about the fixed payment option

Arion Bank also offers the fixed payment option (Icelandic: Greiðslufesta) for customers who choose non indexed loans but wish to reduce their monthly payments.

With the fixed payment option, a fixed monthly payment, lower than the contractual instalment, is paid for twelve months. The difference is added to the principal, increasing the loan amount. Customers may choose to base the fixed monthly payment on an interest rate that is 1%, 2%, 3% or 4% lower than the loan’s current rate.

You can read more about fixed payment option here .

More information

Further information on Arion Bank mortgages can be found here.