In the final part of our series on buying a house in Oulu, 65DN delves into the world of the city’s banks.

So, you’ve found a house you want whether it’s an omakotitalo, paritalo or riivitalo. You’re sure it’s just right for you but unless you have enormous savings or an equally enormous income you’re likely to need to get a mortgage. And so it’s time to go to the bank.

The first major problem here for an expat in the city is language. To really understand the kind of information the bank will demand of you or send to you, it won’t be good enough to speak conversational Finnish. Many Finns, attempting to negotiate a mortgage, are sometimes puzzled by the whole process despite Finnish being their native language.

House-hunter Tuuli, 30, wanted to know in advance of even looking for a house exactly how much the bank were prepared to give her and her husband.

‘I thought it was stupid for anyone to pay more than 200,000 euros for a house in northern Finland,’ she explained. ‘In fact, I know an estate agent who told me there’s a bubble here and it’s crazy to pay more than that. So I asked for 200,000 and that’s what they gave me. But they also asked all these questions using all these words and concepts that I don’t understand. Most of the time when they gave me options, I just went for one of them. It was so hard to understand what they were talking about.’

Naturally, this is made ten times worse if you happen not to speak to Finnish or not to speak it with near-native fluency.

‘I really couldn’t understand anything in the Finnish,’ said an American expat who wished to remain nameless. ‘So I asked the bank if there was someone who could speak English. Of course there was. But their English wasn’t good enough to be able to really explain me any of the complicated legal and banking words and ideas. It was painful. I felt so sorry for the employee that had to deal with me.’

In my experience was fairly similar to the Americans. Even if I had been negotiating a mortgage in a country where English was the native language I would have found it difficult and would not have known or really understood many of the terms and ideas. Trying to do it in Finland was truly excruciating. The banker’s English was so poor that it ended-up with my speaking in English and him speaking in Finnish or vice versa depending on the situation. There were numerous words which I didn’t know in Finnish and he didn’t know in English. The word ‘mortgage’ (the specific English-word for a home-loan) caused terrible confusion because, in Finnish, they simply use the equivalent of ‘loan.’

Finnish banks do have access to English-language information and documents and I was able to sign a loan agreement written in English. The problem is that it’s not always accurately translated which leads to even greater bemusement. I did not, for example, know the Finnish word for ‘deed’ which seems to be ‘pantti’.  However, it had been translated – in all official documents – not as ‘deed’ at all but as ‘pledge’ which is a slightly different thing in English. Being informed that ‘The pledge will stay in the bank’s safe until you have paid off mortgage’ thus totally threw me.

The language-barrier aside, actually negotiating the mortgage was slightly different from what I imagined. Assuming your Finnish is good enough, you don’t even have to speak to anybody – in the first instance – to apply for a mortgage. You simply type into their website – assuming you are a member of their bank – how much you want and how much you’d like to pay back per month. Then, in something reminiscent of the imported British sketch show Little Britain (with its social satire of a jobs-worth pen-pusher), ‘Computer says no’ if it deems your monthly payment insufficient. It will not let you move on, at least at my bank, until you type in an amount it considers acceptable.

Eventually, you will be telephoned to negotiate your mortgage further. This can be very frustrating and in my own case at least I would be rung up, sometimes, hours later than the agreed time. Negotiating the mortgage over the phone takes at least an hour and involves all kinds of detailed questions about the precise nature of the mortgage. What kind of interest rate do you want? If it’s high interest rate it will be checked – and altered – less often. Do you want an interest ceiling for a set period of time? If so, the interest will obviously be higher. To make the right decision – as in any country – you need a reasonable grasp of economics and plain good luck. Would you like to ensure the mortgage such that if one of you dies the bank writes off the entire mortgage as a kind of consolation for your bereavement? This is a particularly expensive gamble which they will adamantly sell to you. Would you like to begin saving for a private pension? Why not do so with our bank alongside your mortgage?

The banks do, however, seem to be quite trusting. In my bank, they wanted to know my income but did not require any evidence for this. Of course, it would be very stupid to lie to them but there was nothing to stop someone desperate for money from doing so. Unlike in some countries, you don’t need to pay a huge deposit either. Over a certain amount, you either have to pay insurance to guarantee the loan or draw upon guarantors who are able, each, to guarantee, at my bank, 20,000 euros. This system puts expats at a distinct disadvantage because many banks will not accept foreigners as mortgage guarantors.

‘I was just happy to get it over and done with,’ laughed the American. ‘We shook hands – me and the seller – the money had been transferred and that was it. I could hear – in the booth next door – a Chinese couple trying to get a loan through speaking English. It wasn’t going well! But hopefully they got it in the end!’