12-month Euribor – the most common home loan reference rate
Euribor is the common reference rate of the money markets in the eurozone. The name of the rate is abbreviated from Euro Interbank Offered Rate.
Many Finns are particularly interested in the 12-month Euribor rate, which is the most commonly used reference rate for home loans in Finland. The home loan interest rate tied to the 12-month Euribor rate is revised every 12 months, i.e. once every year. This makes the interest rate on your loan more predictable, because it is fixed for one year at a time. The total interest rate on your loan agreement (reference rate + margin) will change during the loan period based on fluctuations in the 12-month Euribor rate.
Euribor rates are managed by the European Money Markets Institute (EMMI). They are calculated for interest rate periods determined by EMMI and quoted at an accuracy of three decimal places at around 12.00 Finnish time on every quotation day.
The Euribor rates were quoted for the first time on 30 December 1998 for the value date 4 January 1999. The interest rate calculation practice in the eurozone money market is based on the actual days/360 days per year. With the Helibor rates, the interest calculation basis was actual days/365 days per year, but they are no longer quoted in Finland. In order for the content of old agreements not to change because of the interest-calculating practice, the Euribor/365 replaced the former Helibor rate. The Euribor/365 was derived from the Euribor rates and published as a separate reference rate until 31 March 2019, after which loans for which Helibor was agreed as the reference rate have had their applicable reference rate calculated from Euribor rates with the formula Euribor x 365/360.
You can check the daily values of the Euribor rates on the Bank of Finland’s “Interest rates” pageOpens new window.