Buying a house - step by step

Find a property

Finding the right property

The results from your credit score should give you a better idea of what you can afford. You can now start looking at real estate within your price bracket. You should evaluate several factors such as property size, price per square metre, local services, public transport, etc.

You found a house!

Finding the right house is just one step towards homeownership. You should always have the property inspected by a specialist so that you are fully aware of any damage or issues that need to be addressed. You can make an offer on the property, listing the inspection as one of the provisions for completion. That way you won´t lose out on the house but you remain protected.

Making an offer

Some tips

You should consider the following before making an offer:

- The offer is binding so you should always have the property inspected by a specialist so that you are fully aware of any damage or issues that need to be addressed.
- You can make an offer on the property, listing the inspection as one of the provisions for completion.
- Consider how you are going to pay for the property.

Bid accepted

Once you have found the right property and a bid has been accepted, a formal credit score evaluation will be carried out and you can then apply for a mortgage. You will need to choose the right mortgage for you and decide how you want to pay for the property. Usually, the first payment is made when you sign the documents required for the close of sale, the second payment is made when the property is handed over and the third and final payment is made when you receive the title deeds to the property.

Credit check

Online credit check

You can check your credit score within minutes, and subsequently apply for a mortgage almost immediately.

Loan documents

Loan documents

Once you have made your final decision, the appropriate loan documents are prepared, and you will receive notification when they are ready to be signed. The documents are sent directly to the real estate agent. You must read them carefully to make sure they are in accordance with your wishes.

Registration

Purchase agreement and registration

A certified real estate agent will review all issues pertaining to both you and the seller, e.g., payment arrangements, payments, etc. You should ask the real estate agent to give you a list of all the documentation needed to close the sale. The signed documents are then sent to the District Commissioner. The mortgage is then paid off when the bank receives a registered mortgage bond.

Delivery

Property delivery

The date of the hand over should be negotiated when you complete the details of your purchase agreement.

Title deeds

Title deeds

The real estate agent will invite both you and the seller to a meeting where the agent will hand over the title deeds once he/she is certain that both you and the seller have fulfilled your obligations according to the purchase agreement. This process can take several months. Usually, the final payment is made once the title deeds have been handed over, but you can hold back some of the money if you have since discovered any defects that were unknown when the purchase agreement was signed. If everything goes according to plan, then the final payment will go through, and the title deeds will be handed over to you. The title deeds are then sent away to be registered and you will subsequently become the registered owner of the property. 

Paying towards your mortgage

Paying towards your mortgage

You can make extra payments on your mortgage, using the online bank. The minimum deposit amount is ISK 1,000. You can shorten the time it takes to repay your mortgage by making extra payments. See further deposit instructions.

Use your private pension

You can use your private pension to pay for your first property. Contact one of our advisors to learn more about this option.
Click here to book an appointment with one of our advisors.

Delay payments

Is there a baby on the way?

You can delay your mortgage payments by anything up to nine months, if baby is on the way and you are about to start your maternity/paternity leave.

You can apply for a delay to your payments by sending us the payment schedule from the maternity/paternity fund (Fæðingarorlofssjóður). We will review your payment schedule and subsequently ask you to sign- off on any changes to the Terms and Conditions of your mortgage. The costs associated with these changes can be found in Íslandsbanki's price list. 
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