Loans in Sweden

Types of Loans Available in Sweden

You can access various loan options tailored to meet different financial needs in Sweden. As a foreigner, understanding these options can help you choose the one that best suits your circumstances.

Mortgage loans (House loans)

Swedish mortgage loans are constrained by an 85% LTV cap, so buyers need at least a 15% cash down payment. Anything above the cap is usually taken as an unsecured top-up at a higher rate. Lenders stress-test affordability and often split the mortgage into tranches so you can mix fixed and variable rates. Getting a bolånelöfte (pre-approval) before bidding strengthens your position and clarifies your ceiling.

Amortisation follows clear thresholds: >70% LTV = 2% per year, 50–70% LTV = 1% per year, <50% = no mandatory amortisation. An extra +1% amortisation can apply if total mortgages exceed 4.5× gross annual income. For non-citizens, there’s no blanket ban, but banks usually require a personnummer, documented Swedish income, and stable employment. Also factor transaction costs such as lagfart (title registration), pantbrev (mortgage deed), and any monthly association fee for a bostadsrätt, as these affect affordability even when the interest rate looks attractive.

Regulatory update: The Government announced plans on 17 June 2025 to raise the LTV cap to 90% and abolish the extra +1% amortisation tied to high debt-to-income, while keeping the 1%/2% LTV-based rules. The proposal targets implementation in 2026; until then, today’s rules apply.

Car Loans

In Sweden, a secured car loan (billån) typically finances up to 80% of the purchase price, with a mandatory 20% cash down payment. The vehicle is pledged as collateral, which usually yields a lower rate than an unsecured loan. Banks often cap the term at up to 8 years, and many require the car to be no older than 10–12 years at the final payment. Dealer financing follows the same legal down-payment rule; if you can’t supply 20% in cash, the remainder is usually taken as a separate unsecured loan.

An unsecured personal loan can fund up to 100% of the price and works well for private-party purchases or older cars that don’t qualify as collateral. Expect higher rates and, commonly, shorter terms (about 1–10 years). Lenders will run a UC credit check; using a comparison broker often means one UC inquiry while collecting multiple offers. Regardless of route, budget for insurance: lenders may require comprehensive cover when the car is collateral. New cars in Sweden normally include a three-year “vagnskadegaranti”, which can overlap with comprehensive coverage needs during that period.

Personal Loans (Consumer loans)

Personal loans are unsecured credits called privatlån or blancolån. Typical ranges are 5,000 to 600,000 SEK with 1 to 20 years terms. Rates are risk-based. Lenders run a UC credit check and verify income, debts, and payment history. Using a comparison broker can mean one UC inquiry while you get multiple offers. You sign digitally with BankID.

Watch the effective annual rate (APR) and fees such as uppläggningsavgift and aviavgift. You have a 14-day cooling-off right and the right to repay early without penalty beyond minor interest adjustment and any documented costs. Sweden also limits high-cost credit: there is a rate cap and a total cost cap to prevent extreme pricing. Aim to avoid lenders that approach those thresholds.

Some providers use a non-UC bureau (for example Bisnode or Creditsafe). These products are marketed as “no UC” and can protect your UC record from additional hard checks, but they still involve full credit assessment. If that is your priority, read our guide to a loan without UC in Sweden and compare total cost before choosing.

Many use a personal loan to consolidate credit cards and small loans. The goal is a lower total APR and a single payment. Consolidation only makes sense if the new loan’s effective cost is lower after fees and term length. Keep the term as short as your budget allows.

Credit Card

A credit card is a revolving credit with an interest-free period of roughly 30–60 days on purchases if you pay the full statement balance by the due date. If you carry a balance, the card charges risk-based interest and any grace period disappears. Most cards add annual fees, foreign-exchange markups (often 1–2.5%), and cash-advance fees. Cash withdrawals typically accrue interest immediately and often have a 2–4% fee, so avoid using a credit card for ATM cash unless urgently needed. Issuers run a UC credit check, and you sign digitally with BankID.

Many Swedish cards include purchase protection and travel insurance when you pay a defined share of the trip (commonly ≥75%) with the card. Some issuers offer installment features (delbetalning) or “0% campaigns” with fixed campaign fees; always calculate the effective APR before opting in. You have a 14-day right of withdrawal on the credit agreement and the right to repay early at any time. Pay at least the statement minimum to avoid late fees, but aim to pay in full to keep the grace period and minimize interest.

Debt Consolidation Loans

A debt consolidation loan (samlingslån) is a single unsecured personal loan used to pay off multiple credit lines and installments. The target is one payment, a lower effective APR, and fewer fees. Lenders perform a full affordability check and a UC credit inquiry. Many providers can settle your old loans directly so the balances are cleared instead of paid into your account. After payout, close old credit lines to avoid re-borrowing.

Consolidation works when the new APR is lower and the term is not stretched too far. Extending the term cuts the monthly bill but can raise total interest. Check the effective annual rate and any setup or invoice fees. You retain Swedish consumer protections: 14-day withdrawal and early repayment at any time. If you have payment defaults or active debts with the Enforcement Authority, options narrow and pricing rises. In that case, speak with municipal budget and debt counsellors before taking new credit.

Quick Loans

A quick loan in Sweden is an unsecured, fast-payout credit, typically 1,000–50,000 SEK with short terms (weeks to ~12 months). Approval and signing are done with BankID, payout is usually to a Swedish bank account the same business day (cut-offs apply). Lenders must run an affordability check (UC inquiry); multiple separate applications can harm your credit—use a broker if you want several offers from one UC pull.

Cost rules (2025). Since 1 March 2025, most consumer credits (including quick loans) are subject to a legal interest cap = reference rate + 20 percentage points, plus a total-cost cap: you never repay more than the original principal in interest and fees. Terms may generally be extended only once. You retain a 14-day right of withdrawal and can repay early at any time to cut interest.

When does a quick loan make sense? Short-term, urgent cash-flow gaps that you can clear quickly. It’s not a low-cost way to refinance larger debts. Consider a personal loan (privatlån) or consolidation instead if you need longer time at a lower APR.

Payday Loans

A payday loan is a very short-term, unsecured advance—often due on your next payday. Providers brand them as smslån/snabblån. Approval is digital via BankID and requires a UC credit check. Funds typically arrive same day on weekdays.

Cost & rules (from 1 March 2025). Payday loans fall under the nationwide interest cap = reference rate + 20 percentage points and a total-cost cap: you never repay more than double the principal including all fees. The term may only be extended once (unless the extension is free or you’re granted a reasonable payment plan). You keep the 14-day withdrawal right and can repay early to cut interest.

Business loans

A business loan in Sweden (företagslån) is credit to a registered company or sole trader for working capital, investments, or growth. Pricing is negotiated case-by-case and consumer caps do not apply (those cover credit to private individuals). Common products are term loans, overdrafts (checkkredit), leasing/hire purchase, and factoring. Startups and SMEs can also apply to ALMI when a bank won’t fund the full need. Expect a UC business credit check, BankID signing, and requests for budgets, financials, and tax registrations (F-tax, VAT). Security often includes a företagshypotek (corporate mortgage) over business assets and a personal guarantee (personlig borgen) from owners.

How financing types differ. A term loan gives a lump sum with fixed amortisation (typical SME terms 2–5 years; longer if asset-backed). An overdraft links to your business account; you pay interest on the utilised balance plus a limit fee and renew annually. Leasing/avbetalning fits vehicles and equipment; the asset secures the credit and payments match its life. Factoring advances ~70–90% of invoice value up front; the remainder arrives at customer payment minus fees. Choose recourse or non-recourse depending on who bears default risk.

Price Example of a Loan in Sweden

To illustrate how loan terms and conditions translate into monthly payments and total loan cost, let’s consider a practical example. In this scenario, we analyze an annuity loan—a common type of loan where the borrower makes fixed monthly payments over the loan’s term. These payments cover both the principal and the interest.

Nominal Rate vs Effective Interest Rate (APR)

In Sweden, loans are advertised with two different rates: nominell ränta (nominal rate) and effektiv ränta (effective annual rate, APR). The nominal rate is the base interest percentage charged on the loan balance. It does not include additional costs. The effective rate, on the other hand, is the legally required figure that shows the true yearly cost of borrowing, including setup fees, monthly invoice fees, and other charges.

This distinction is critical because a loan with a low nominal rate but high fees can actually be more expensive than a loan with a slightly higher nominal rate but low fees. The APR makes different offers directly comparable.

Examples

Key takeaway: Always compare effective ränta (APR) when choosing a loan in Sweden. A lower nominal rate can be misleading if fees are high.

How much can you loan in Sweden?

In Sweden, the amount you can borrow varies based on the loan type, your financial situation, and the lender’s criteria. The typical borrowing range for personal loans is between 1,000 and 600,000 SEK.

But what determines how much you can loan? Here’s the main factors.

• Income and Debt: Lenders assess your income and existing debts to determine your ability to repay. A higher income and lower debt-to-income ratio can increase the amount you’re eligible to borrow.
• Credit History: A good credit history in Sweden suggests you’re a reliable borrower, which can positively impact the loan amount offered.
• Employment Status: Stable employment, especially if you’re on a permanent contract, reassures lenders of your capacity to repay, affecting the loan amount.
• Lender’s Assessment: Each lender has specific guidelines for determining loan amounts. They consider risk factors and market conditions in their evaluation.
• Loan Purpose: The reason for your loan can influence the amount. For example, lenders might be willing to offer more for home renovation compared to a vacation loan.
• Regulations: There are legal frameworks in place that might limit borrowing amounts to prevent overindebtedness among consumers.

Credit Bureaus in Sweden and Why They Matter

When you apply for a loan in Sweden, the lender almost always performs a credit check through one of the main bureaus: UC, Bisnode, or Creditsafe. Which bureau is used depends on the type of lender, the product, and sometimes the borrower’s profile.

UC (Upplysningscentralen) is the dominant credit bureau in Sweden and is used by most banks and major financial institutions. A UC inquiry is considered a hard check and will stay on your record for 12 months, visible to other lenders. Multiple UC checks in a short period can lower approval chances, as it signals frequent credit applications.

Bisnode and Creditsafe are alternative bureaus. They provide full credit assessments but their inquiries are not always visible to UC. Lenders offering “no UC” loans usually mean they use Bisnode or Creditsafe instead. While this avoids adding another UC record, it doesn’t mean the credit check is any less thorough.

There is also a distinction between hard checks (visible to other lenders and affecting your credit profile) and soft checks (only visible to you). Soft checks are often used by comparison sites or pre-qualification tools. If you apply through a loan broker, they can usually collect multiple loan offers while performing only one UC check, reducing the impact on your record.

Typical Bureau Use by Lender Type

Glossary of Swedish Loan Terms

Understanding local terminology is essential when applying for a loan in Sweden. Below is a concise glossary of key financial terms you will encounter during the loan process. Each term has a short, practical definition to help you navigate Swedish banking and lending.