The bank customers who pay 7,000 too much – are you one of them?

The bank customers who pay 7000 too much are

The Swedish people have, in recent years, been forced to get used to flipping the pennies in order to make everyday ends meet.

Not only did electricity prices go up significantly in 2021 and 2022, which meant that households had to struggle to keep electricity consumption down, but rising inflation also made food and other goods significantly more expensive.

What is inflation?

“Inflation is an increase in the general price level that allows you to buy fewer goods and services for the same amount of money. The price of the same basket of goods in the store rises over time and the money thus decreases in value.”

Source: The Riksbank

In December 2022, inflation, according to the consumer price index (CPI) measure, was 12.3 percent.

– This is bad news for households, said Shoka Åhrmansavings economist at SPP, to TT then and continued further:

– Households with a mortgage, who live in their own house and have a car are hit hard. And those who are always affected, those who are weakest, find it especially difficult now.

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Graphics from December 2022. Image: TTShoka Åhrman. Photo: Christine Olsson/TT

Because the high inflation also meant that the Riksbank, starting as early as May 2022, began to raise the key interest rate, which for several years had been at zero or even minus. In connection with this, the variable mortgage interest rates also skyrocketed to levels not seen for a long time.

Since then, however, inflation has fallen – to 1.9 percent according to the CPI in August according to Statistics Sweden – and likewise the mortgage interest rates. But in a debate article, with Arvid KrönmarkCEO of Skandiabanken, Michael EnglandCEO of SBAB and Per LindbladCEO of Landshypotek Bank, as the sender, means that Swedish bank customers pay way too much in interest anyway.

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Mikael Inglander, CEO at SBAB. Photo: Emma-Sofia Olsson/SvD/TT “Paying too high mortgage interest”

In the debate article, published in SvD, the CEOs criticize what they call the “big bank model”, which according to them assumes that bank customers negotiate with their bank for discounts.

“The stronger the customer’s negotiating position – for example, high income and large savings – the greater the opportunity they have to influence their interest rate. But this is where one of the main problems with the model can be found: both the customers’ willingness and ability to negotiate vary widely, which leads to customers who do not have a good ability, or the time to negotiate, pay too high mortgage rates,” they write in the article.

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Photo: Fredrik Sandberg/TTPhoto: Izabelle Nordfjell/TT

Skandia has, through a survey with figures from August, been able to show how big bank customers who are home owners in Stockholm pay an average of SEK 7,000 more than necessary per year in mortgage interest. Even apartment owners in the capital pay “too much” for their mortgages. For these, the so-called “big bank surcharge” of SEK 5,000 per year lands, according to the survey.

“We urge Sweden’s mortgage borrowers to critically examine their current mortgage interest rates. Find out if the interest you are paying is reasonable by comparing it with the banks that offer transparent mortgages. But consumer power also requires information,” the bank leaders write in SvDwhere they continue further:

“Today, much focus is placed in the media on the negotiation path. Our hope is that the negotiation-free mortgage model will become as obvious a part as the big banks’ negotiation loans. For consumers, negotiation-free and transparent mortgages can be the way to a better relationship and increased trust in their bank.”

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