Repayment methods

The interest rate on a housing loan comprises a reference rate and a margin. The repayment method will affect the interest expenses during the loan period.

There are three different methods for repaying a housing loan: equal payments, equal instalments and fixed equal payments. The choice of the repayment method depends on many things, such as whether you want to pay the same amount every month or whether you prefer to pay off the loan within a specific time period.

See which of the repayment methods is suitable for you. You can test the impact of the repayment methods on the repayment amount with the loan calculator

Equal payments

This is a good option if you want to know exactly when the loan period ends and if your repayment ability allows a possible rise in the interest rate level.

  • The repayments (instalment + interest) are of equal size at the beginning of the loan period.
  • The repayment only changes if the interest rate changes.
  • Initially, the proportion of the instalment is small, but it increases during the loan period as the proportion of interest decreases.

Equal instalments

This is your choice if you want to make larger payments in the beginning.

  • The instalment is always the same, but the repayment amount varies in accordance with the interest: if the reference rate rises, the repayment increases; if the reference rate decreases, the repayment decreases.
  • If the interest rate remains the same, the proportion of interest decreases as the loan principal decreases.

Fixed equal payments

This is a handy repayment method if you want to know exactly how much your repayments will be well into the future, and the duration of the loan period is not as important.

  • All repayments are of equal amount throughout the loan period.
  • If the reference rate rises, the loan period is extended; if the reference rate falls, the loan period shortens. The repayment is always at least equal to the amount of interest.
  • If the interest rate level is very low at the time you draw down the loan, a rise in the interest rate may extend the loan period unreasonably, hindering the amortisation of the loan. In such an event you should contact the bank and agree on a new repayment plan.

Bullet repayment

This option is usually used for temporary financing. The entire principal of the loan is repaid in one go, but there can be several interest payments.

Instalment-free period

During the instalment-free period you only pay interest, not the principal. This extends the loan period or increases future instalments.

Housing loan products Interest rate hedging Housing loan products

Housing loan

Apply for a housing loan that suits your needs from Nordea

With Nordea's housing loan you can realise your dreams – buy a home, build a house or purchase an investment property.

HomeFlex

Large purchases with a small monthly payment

Is your home in need of refurbishing or is your housing company planning to renovate its plumbing? HomeFlex will free up your home equity so that you can realise your.

ASP loan (ASP account)

Save 10% of the price of a new home in an ASP account, and we will lend you the rest

You can open an ASP account if you are aged between 18 and 39.

Interest rate cap

Don't let the interest on your housing loan get out of hand

With an interest rate cap, you can make sure that the reference rate on your loan will never exceed a certain level. An interest rate cap can be taken for an old or a new loan.

Interest rate collar

Stability to reference rate changes

The interest rate collar is a new kind of interest rate hedging product with which you ensure that the reference rate on your loan stays within the agreed limits and will not exceed the agreed maximum level during the validity of the hedge.

FlexiPayment

FlexiPayment can be added to a new loan as well as to existing ones

When you have FlexiPayment linked to your housing loan, you can decrease or increase the monthly instalment on your loan – or even skip the instalment for a month without notifying us.

OwnGuarantee

An OwnGuarantee helps you to acquire a home with a small start capital

With an OwnGuarantee, you need less savings for financing a new home, and you may not need any other security for your housing loan.

Pay your own share of a housing company loan

Does the charge for financial costs you are paying your housing company seem too high?

If you take your share of the housing company loan in your own name, you get two advantages: you can tailor the monthly payment to suit your finances and you get a tax benefit.

Interest rate hedging

Fixed interest rate

When your loan has a fixed interest rate,

you will know the exact amount of your monthly instalments during the fixed interest period.

Interest rate cap

Don't let the interest on your housing loan get out of hand

With an interest rate cap, you can make sure that the reference rate on your loan will never exceed the agreed maximum level. An interest rate cap can be taken for an old or a new loan.

Interest rate collar

Stability to reference rate changes without a separate fee

The interest rate collar is a new kind of interest rate hedging product with which you ensure that the reference rate on your loan stays within the agreed limits and will not exceed the agreed maximum level during the validity of the hedge. You can link the interest rate collar either to a new loan or your existing loan.

Advice Block title

Man sitting thinking by house 

Interest rate hedging makes life secure

With the right interest hedging products, you can protect your finances even when market interest rates change drastically.

Woman looking out of window 

Two alternatives

FlexiPayment gives you leeway for your monthly loan repayment. Another alternative is to extend your instalment-free period. See which one suits you better.