Iceland Drops Mortgage Rates To 4.7%

Although the banks have offered mortgages for several years, the government-owned Housing Finance Fund remains the country’s biggest mortgage provider and usually offers the lowest interest rates.

Iceland's Housing Financing Fund (HFF) was established on January 1st,1999 taking over all assets and obligations of its predecessor, the State Housing Board. HFF is the largest issuer of inflation linked bonds in Iceland.

HFF's mortgage loans have the following components.

• Same terms anywhere in Iceland

• Loans for up to 80% of bid price or construction cost

• Maximum loan amount ISK 20 million

• 4.70% interest on loans with a prepayment clause

• 5.20% interest on loans without a prepayment clause