Despite the fact that every small interest rate point gives households more money in their pockets, many find it difficult to navigate through mortgage rates. To identify the cheapest providers, Affärsvärlden has conducted a study looking at the average variable interest rates in August over the past six years. The results show that it is the smaller players that consistently offer the best variable rates year after year, with some variations. Companies like Länsförsäkringar Bank, Skandiabanken, and Stabelo have often been able to offer the best terms in recent years. For example, in August of this year, a variable mortgage at Länsförsäkringar Bank cost 4.18%, while at major banks Swedbank and Nordea, the average rates were 4.41% and 4.45% respectively.
“We strive for our mortgage rates to not be the cheapest or the most expensive, but Swedbank aims to provide customers with the best overall offering,” says Love Liman Jacobsson, press officer at Swedbank.
Danske Bank has improved its rates over the past two years after being at the bottom, managing to rise among the top three cheapest mortgage lenders. However, in August of this year, both LF Bank and Stabelo offered lower rates than Danske Bank’s customers. Skandiabanken has managed to make it to the podium in five out of the six August months that Afv has examined closely.
“I think it’s all about competition – these banks want to attract more customers and see that it works when they lower rates. Also, Danske Bank has lower rates for those who are union members, and Skandiabanken offers a discount for those who have pension savings with them – so there are likely such aspects as well,” says Christina Sahlberg of the loan comparison site Compricer.
Not everyone can borrow from Stabelo
Stabelo, the housing institute that had the lowest variable rate between 2019 and 2021, has been overtaken by both Länsförsäkringar Bank and Skandiabanken in the past two years. However, the ambition is to grow and be the cheapest. In September of this year, Stabelo’s variable rate was 4.05%, once again the best in class. In August of this year, the mortgage challenger settled for second place.
But not everyone can take out a loan with Stabelo. If you need to borrow a lot relative to your home’s value, you may not qualify. Online brokers Avanza and Nordnet collaborate with Stabelo.
“Stabelo may be able to offer a lower rate because they only accept leverage up to 60% of the home – meaning they take on lower risk,” says Christina Sahlberg.
So, how cheap are the major banks? Handelsbanken and SEB sometimes show up among the lowest average rates. In August of 2019, 2021, and 2022, SEB’s average rate was the third lowest. However, in the past three years, there has been less price pressure. The bank’s customers have had to pay higher rates than other providers.
A bank that never appears in the cheapest top is Swedbank. But there is one player that is even more expensive, Nordea. The bank’s rates have been the most expensive in four out of six examined August months. Interestingly, Nordea is gaining market share in the mortgage market, as Afv has reported.
Not the cheapest in the state-owned bank
State-owned SBAB, which often emphasizes its business model of no fixed-term rate discounts that need to be negotiated, has struggled to act as a price setter. Their rates have been among the higher ones in recent years. A few years ago, their average rate was in the top three. However, it has been a while since then.
“SBAB often adjusts rates in line with higher or lower borrowing costs. And yes, they were supposed to be price setters, but it doesn’t seem to have worked out that way,” notes Christina Sahlberg.
“As a state-owned bank, we can influence the rate, but we cannot set any rate level. After all, we operate in a commercial market. We strive to offer competitive mortgages and fair savings rates while also meeting the goals set by the owner (the state) regarding profitability and dividends,” says Catharina Henriksson, communications chief at SBAB.
SBAB does not make excessive profits but aims to deliver on the goals set by the state owner.” Title: The Rise of Sustainable Investing: A Shift Towards Ethical and Profitable Investments
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