Sales price. (Myyntihinta) The price paid to the seller. In new properties, the buyer may have to pay up to 70% in housing company loan on top of the sales price.
 
Debt-free price. (Velaton hinta)The sales price + the apartment’s share of the housing company loan. Typically, the housing loan covers the entire debt-free price, in which case the housing company loan is repaid in connection with the transaction.
 
Maximum loan-to-value ratio. (Enimmäisluototussuhde) The maximum amount of loan in relation to the fair value. For first-time home buyers, the ratio is 95% of the debt-free price, for others, 90%.
 
Variable annuity. (Tasalyhennys) The monthly loan instalments remain the same until the reference interest rate changes (for example, for 6 or 12 months). Particularly popular in long-term loans.
 
Equal instalments. (Muuttuva annuiteetti) You repay the loan every month in equal instalments, but the amount of interest depends on the remaining loan. Rarely used for large loans, as the monthly instalments would be high in the beginning.
 
Total interest rate. (Kokonaiskorko) The selected reference interest rate (for example, 12-months Euribor) plus the personal margin specified by the bank.
 
Self-financed amount. (Omarahoitusosuus) The share of the sales price covered by savings. For first-time home buyers, the minimum share is 5%, for others, 10%. If the self-financed amount is 30% of the sales price, no additional security is needed as the value of the apartment or property is 70% of the debt-free price.
 
Equal payment. (Tasaerä) You pay the same amount every month. As the interest rate changes, your loan period will become longer or shorter. Applicable to loans with a maximum repayment period of 20 years.
 
Fixed interest rate. (Kiinteä korko) Remains the same for 3–25 years. Many choose a fixed interest rate for a specific period of time at the start of the loan period in order to predict their monthly expenses more accurately.

Less known terms

Actual annual interest rate. (Todellinen vuosikorko) Reference interest rate + margin + annual loan management costs + loan application fee. An important figure when making comparisons between the loan offers of different banks.
 
DIAS transaction. (DIAS-kauppa) Digital real estate transaction, made digitally online from start to finish. A little over 40% of all transactions are digital at the moment. 
 
Contract of pledge. (Panttikirja) Needed when the plot or building is used as security for the loan. Any old contracts of pledge transferred with the transaction save money, because the application and title registration of electronic contracts of pledge costs EUR 800.

Most misunderstood terms

Net salary.  (Nettopalkka) The amount of salary that remains after deducting taxes and other statutory payments. The money paid into the bank account on the payment date.
 
 Gross salary. (Bruttopalkka) The amount of salary before deducting taxes and statutory payments. The larger amount.
 
 Interest rate cap. (Korkokatto) Specifies an upper limit for the interest rate, but the interest rate can also be lower than this. Gives the opportunity to benefit from decreasing interest rates. An additional service for loan customers that is subject to a charge.
 
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