Equity loans

You can either apply for an equity loan when you have signed a purchase offer or you can apply for the loan based on the estimated property price. Applicants with accepted purchase offers have priority on allocation.

With an accepted purchase offer

When you have signed a purchase offer, you undergo a credit assessment and apply for a basic loan to the credit institution of your choice and an equity loan to HMS. When applying to HMS you can use a credit assessment from another credit institution.

Supporting documents:

• Confirmation of 5% personal funds with a bank statement showing the status of all your accounts.

• A signed purchase offer.

• Last tax report’s tax assessment results.

• Credit assessment provided by the credit institution that will provide the base loan.

• If a base loan is in place, confirmation of its amount and terms of credit, is required.

When you have submitted your application, you will receive confirmation of receipt by email. HMS loan advisors will be in contact if further information are needed.

Application accepted with a purchase offer

When a loan is approved, the conditional loan promise is sent to your HMS My Pages. You forward it to your real estate agent who will provide HMS with information on the purchase agreement, copies of the documents for the base loan and certification of the building commissioner’s safety inspection. Equity loans are disbursed when these documents are ready and have been registered (þinglýsing) at the District Commissioner’s office, (Sýslumaður).

Without a purchase offer

You can apply for an equity loan for the estimated purchase price to get a conditional loan promise. It is a good idea to check the size and price limits to see what amount you intend to apply for. After submitting an application you will undergo a credit assessment with HMS.

Supporting documents:

• Confirmation of 5% personal funds with a bank statement showing the status of all your accounts.

• Last tax report’s tax assessment results.

When you have submitted your application, you will receive confirmation of receipt by email. HMS loan advisors will be in contact if further information are needed.

Application accepted without a purchase offer

• You find a property that is eligible for an equity loan (hlutdeildarlán). You can do this by going to fasteignir.is or some other property website.

• You make an offer on a property that meets the conditions of equity loans.

• When you have signed a purchase offer, you forward it along with information on your base loan (if available), by email to

  hlutdeildarlan@hms.is.

• If the property meets the conditions for equity loans, you will receive a conditional loan promise that is valid for 3 months. It will be sent to your HMS My pages.

• You forward it to your real estate agent who will provide HMS with information on the purchase agreement, copies of the documents for the base loan and certification of the building commissioner’s safety inspection. Equity loans are disbursed when these documents are ready and have been registered (þinglýsing) at the District Commissioner’s office (Sýslumaður).

Loan denied

If a loan application is denied, you will receive an email with our formal ruling and there you can see our reasons for refusal. If some documents are missing or if your situation has changed in some way, you can apply for a revision of your application and provide us with new information.

HMS rulings can be appealed to the Welfare Appeals Committee

Personal funds

Personal funds is the amount you have when debts (for example, short-term loans, overdrafts or car loans) have been deducted from your assets (for example, money or a car). Student loans do not count as debts.

You can use personal pension savings that you have accumulated from 1. July 2014 (until 31. December 2024) as personal funds. You can use a maximum of ISK 500.000 for each year in the period you choose. For more information, see the tax office website.

Cost of borrowing:

• Loan charge is 58.500 ISK.

• Credit rating for an individual is 8.400 ISK and 16.400 ISK for couples or cohabitants.

• Registration fee at the District Commissioner’s office (Sýslumaður) is ISK 2.700.

Monthly allocations

Every year the Icelandic government allocates a certain amount to equity loans. Each month is a separate allocation period and if the applications received exceed the allocated monthly amount, applications will be drawn randomly. However, applicants with accepted purchase offers have priority when allocating. If an application is denied because of this, you can apply again next month.

Processing time

Applications are usually processed within one week of their receipt. When an application is processed or if documentation is missing, you will receive notification by email from a HMS loan advisor.