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Sunday, March 26, 2023

Horrible increase in mortgage repayments – 170,000 ISK increase in monthly repayments

<h3 style=”font-weight: 400;”>During the pandemic, a high-income fisherman took out a $70 million mortgage with variable interest rates. The first payment took place in May last year and amounted to 340,000 ISK. But after several increases in key interest rates by the Central Bank, the monthly payment now reaches 540,000. The monthly payment has therefore increased by 170,000 ISK. On an annual basis, the increase is about two million.</h3>

The newspaper explains this today and has this from Breka Karlsson, the president of the Consumers Association, who said the man had approached the association.

To cover this increased indebtedness, the man must increase his income by 3.7 million per year.

The Central Bank is expected to raise interest rates even more next week and then the man’s situation will get even worse.

Breki said the only recourse for people in a similar situation is to negotiate with lending institutions to convert an unsecured loan to a secured loan. Then interest rates will bite less, Breki said, but pointed out that at the same time it defeats the Central Bank’s objective of lowering interest rates by pushing interest rates again. people to indexed loans.

You can read more about the case in today’s Frétablaði.

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